UPDATE 2-US activist Norquist blesses Boehner's tax plan, conservative group rejects it

Thomas Ferraro and Rachelle Younglai
Reuters Middle East

* Norquist says Boehner plan would not violate anti-tax


* Club for Growth urges rejection, calling it "anti-growth"

* Conflicting assessments may complicate efforts to pass it

WASHINGTON, Dec 19 (Reuters) - Leading U.S. anti-tax

activist Grover Norquist gave his blessing on Wednesday to House

Speaker John Boehner's plan to avert the "fiscal cliff,"

concluding that despite complaints to the contrary, it would

adhere to Republican lawmakers' pledges not to raise taxes.

But more than a dozen other conservative figures and groups,

including the Tea Party Express and the Heritage Foundation,


They urged lawmakers to oppose the plan when it comes up for

a vote on Thursday in the House of Representatives.

Some even warned that legislators who back Boehner's plan,

risk being voted out of office in 2014.

Technically, Boehner's proposal, which has been dubbed "Plan

B," does not include a tax increase. What it does is prevent any

tax hikes on annual incomes of up to $1 million, thus permitting

tax increases on higher incomes.

That seemed to be enough of a distinction for Norquist's

Americans for Tax Reform to say the plan does not violate its

anti-tax pledge.

"Having finally seen actual legislation in writing, ATR is

now able to make its determination," Norquist's group said in a

one-page statement. "ATR will not consider a vote for this

measure a violation of the Taxpayer Protection Pledge."

The Club for Growth read the bill differently.

"On the substance, this bill is anti-growth," said Andy

Roth, the group's vice president for government affairs.

"It increases tax rates for those making over $1 million

while also raising taxes on capital gains and dividends," Roth

said. "We don't buy into the Washington-speak, suggesting that

these are actually tax cuts."

Brent Bozell, president of ForAmerica, a conservative

advocacy group, said: "Fiscal conservatives will not stand for

this. If Republicans support the tax increase, they will lose

control of the House in 2014."

The conflicting conservative assessments will complicate

efforts by Boehner to defy a White House veto threat and get his

plan through the House and to the Senate for consideration.

House Republican leaders have voiced confidence that their

chamber will sign off on Boehner's plan, cranking up pressure on

Obama and fellow Democrats in the Senate to make concessions.

But Democrats have denounced the plan, portraying it as a

misguided distraction from on-again, off-again talks between the

president and the speaker.

Boehner's "Plan B" would shield more than 99 percent of

Americans from a tax hike. But it would let tax rates

automatically rise on annual incomes of more than $1 million, as

scheduled, on Jan. 1.

Obama has proposed a threshold of $400,000 a year in income,

up from an earlier $250,000. Any tax increase would be part of a

long-sought deal to reduce the U.S. budget deficit.

Unless the White House and Congress reach agreement by the

end of the month, a crush of tax hikes and spending cuts are set

to take effect, threatening to push the United States over the

so-called "fiscal cliff" and back into a recession.

Boehner and fellow Republicans had long demanded that all

tax cuts signed into law by Republican President George W. Bush

be extended before they expire next month.

But Boehner caved, noting that Obama had won re-election

last month promising to raise taxes on the wealthy and thus had

the upper hand.

Norquist began circulating his anti-tax pledge to members of

Congress in 1986. Over the years, it has been signed by most

Republican, helping block countless efforts by Democrats to

raise taxes and expand government.

The assessment of Boehner's plan by Norquist's group was

quickly circulated by the speaker's office.

"This legislation ... permanently prevents a tax increase on

families making less than $1 million per year," ATR said in its


"Republicans supporting this bill are this week affirming to

their constituents in writing that this bill - the sole purpose

of which is to prevent tax increases - is consistent with the

pledge they made to them," ATR said.

Roth denounced the bill, however, and said lawmakers' votes

on it would be used in his group's annual "scorecard" of members

of Congress.

Representative Tim Huelskamp, a Kansas Republican, said he

would vote against the bill but declined to predict how many of

his colleagues would oppose it. Republicans recently stripped

Huelskamp of a committee assignment amid complaints he was


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