Republican opposition to the House Ways and Means Committee's version of tax overhaul is expected to take the spotlight today as some Republicans ask President Reagan to abandon the committee version and consider a GOP substitute instead.
The White House has been warned by Democratic leaders and Treasury officials that tax overhaul will die in the House unless the president gives at least a lukewarm endorsement to the Ways and Means legislation.
As the measure heads for a vote in the House before Christmas, political manuevering has been intense. Business groups will be lobbying on both sides of the issue at the White House and on Capitol Hill today in a blitz before the measure faces key votes.
Reagan has not yet decided whether he will support the Ways and Means bill, which would lower tax rates and curtail deductions, but by less than the president proposed.
It would cut the top tax rate from the current 50 percent to 38 percent, rather than the 35 percent Reagan suggested, and would retain the deduction for state and local taxes, which the president would have wiped out.
Sen. Slade Gorton (R-Wash.), who flew back from Washington state with Reagan on Air Force One yesterday, said the White House was "torn in two directions" over the Ways and Means bill. Officials have "real concerns" about the substance of the measure, Gorton said, but also want "to keep tax reform moving." And chief of staff Donald T. Regan said yesterday the White House will not make a decision until officials have closely studied the bill.
Ways and Means Republicans, who met yesterday to go over their alternative proposal, would say little about what it included. But ranking minority member John J. Duncan (R-Tenn.) said he "definitely" will propose a substitute package in the Ways and Means meeting today.
Although few details were available, sources said the GOP plan might pay for the tax breaks it preserves for business investment, the oil industry and pensions by partially limiting the deduction individuals can take for state and local taxes. That kind of juggling is necessary to keep the package from bringing in less federal revenue than the current tax code.
One possibility would be to let taxpayers deduct 75 percent of state and local sales, property and income taxes, rather than the full deduction they now get. Sources also suggested the GOP package may have a higher top tax rate than Reagan's 35 percent.
The package -- assuming it is completed during the night -- is expected to be presented to Reagan at a meeting with congressional Republican leaders and to Treasury Secretary James A. Baker III earlier in the day. Duncan said he probably will not ask the administration to decide whether to support the GOP plan right away.
An aide to House Republican Leader Robert Michel (R-Ill.) said the package produced by the committee's Republican staff over the Thanksgiving break would be a "base" for a GOP tax plan.
Business groups both for and against the Ways and Means plan, meanwhile, are preparing lobbying campaigns, while yesterday, two large labor organizations, the AFL-CIO and the American Federation of State, County and Municipal Employes, came out in favor of the Ways and Means bill.