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In Senate, GOP puts damper on a tax cut

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Republican leaders in the Senate have decided it would be futile to push for a big tax cut this year, infuriating conservatives in both the House and Senate who had hoped the prospect of huge federal budget surpluses would lead to swift passage of sweeping tax reductions, members of Congress and aides said Thursday.

The split within the party, which has been festering for months and erupted during a closed-door meeting of Republican leaders of both chambers on Wednesday night, complicated and perhaps doomed efforts by the party's tax-cutting wing to ram through an election-year tax package that would set up a potent confrontation with congressional Democrats and President Clinton.Republican aides said Senate leaders saw no prospect of passing any big tax cut because doing so would require 60 votes, far more than the party, which holds 55 seats, has any chance of mustering. And they said the benefits of waging a symbolic fight were outweighed by the risks, including the certainty that Clinton would accuse them of risking Social Security's long-term health to give tax cuts to the wealthy.

House Republicans, who have been pushing for a tax cut of historic magnitude as the nation enters a new era of fiscal health, said on Thursday that they were intent on following through with plans to vote in September on a tax reduction of as much as $700 billion over the next decade.

Conservatives said a House vote might then force the Senate to reconsider before Congress adjourns in October, and they expressed optimism that Senate leaders might still change their minds. But they admitted that the current lack of support from Senate leaders clearly endangered their efforts.

Both parties have been struggling for months to adapt their politics and policies to the prospect of ever-larger budget surpluses. But the battle over taxes has heated up just in the last week, after the Congressional Budget Office more than doubled its estimate of the surplus over the next decade.

The budget office said the federal government would have a surplus over the next decade of $1.55 trillion. Of that amount, though, about $1.4 trillion would come from Social Security payroll tax revenue in excess of what Social Security needs to pay current benefits.