GOP caucuses still wrangling over tax cuts

It's still no deal when it comes to tax cuts.

Both the House and the Senate GOP caucuses spent nearly three hours Thursday behind closed doors discussing the latest proposal for giving Utahns tax cuts.

But neither caucus was ready to back the proposal, drafted earlier in the day by Senate Majority Leader Curt Bramble, R-Provo, and House Majority Leader Dave Clark, R-Santa Clara.

So the majorities in both the House and the Senate will caucus again about taxes on Friday.

House sources said the 50-member GOP caucus discussed the compromise at some length but in the end rejected it. Instead, they decided to go with a $250 million tax cut, a 5 percent flat-rate tax (a reduction from the current 5.35 percent) and a 6.7 percent top rate on the current multi-exemption income tax system (a reduction from 6.9 percent).

House Republicans would still like to cut sales tax by $80 million, with a mix of lowering the state sales tax on food and just slightly reducing the overall sales tax rate.

"We just can't get close to the Senate" on reducing the food tax/general sales tax, said one Republican.

Senate leaders, who were to meet with their House counterparts late Thursday, are frustrated.

"If the House decides to take their little red wagon and go home, that's unfortunate," a visibly upset Bramble said. "The Senate is at the table, trying to find a compromise."

Details of the so-called compromise proposal are being withheld, but the combination of cuts in personal income taxes and the sales tax on food is believed to add up to around $200 million — too small a number for House conservatives.

"We're still talking," Senate President John Valentine, R-Orem, said afterward. He said the compromise was "in the ballpark" but his caucus was concerned about having enough money to fund the priorities they set earlier this session.

The GOP Senate had committed to a $150 million tax cut, at least a $300 million increase in public education spending and significant boosts for transportation, higher education and state employees. They also called for no new bonding and the reduction or elimination of the state's existing debt.

But, Valentine said, only public education is getting a fair share of the $1.6 billion surplus under the proposal. "I would call it 'short-sheeting' the rest," he said, describing the majority's problem as being with "the overall package" rather than specific cuts.