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Lobbies To Combat President's Proposal on Tax Deductibility

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Washington--As the Senate opened hearings last week on President Reagan's tax-overhaul proposal, educators and some Congressmen stepped up their attack on his plan to eliminate the federal income-tax deduction for state and local taxes.

Aaron S. Gurwitz, chief municipal economist with Salomon Brothers, Inc., told a gathering on Capitol Hill that the President's tax-reform plan "affects education and state and local governments more than it affects anyone else."

In lobbying against elimination of the state and local tax deduction, Mr. Gurwitz said, "The education community should not be polite outside the doors of the House Ways and Means Committee. They should elbow their way to the front of the line."

The House tax-writing panel is expected to hold hearings on the plan throughout the summer and write a tax bill in the fall.

At a related press conference last Thursday, Senator Paul Simon, Democrat of Illinois, suggested that senators might filibuster against the deductibility issue if it reaches the Senate floor. He said that such a move is "not out of the question. ... I think this is one of those occasions when [a filibuster] may have to be used."

Elimination of the state and local tax deductions "would do great harm to the cause of education, and great harm to the Middle West," the Senator said. "It simply should not be done."

Mr. Gurwitz and Senator Simon spoke at a kick-off meeting of a newly formed lobbying group, "Save State and Local Tax Deductibilility," or salt-d. The coalition of some 20 groups plans a summer lobbying effort against the deduction-elimination proposal, culminating in a nationwide "tax reform information day" known as salt-d Day, Sept. 18.

At another press conference held with education leaders last week, Senator Daniel P. Moynihan, Democrat of New York, called the proposal an "awful blow to education at a time when the federal government is reducing its outlays" for education support.

Eliminating the deductions would result in an average nationwide reduction in per-pupil revenues of $606, from an average per-pupil expenditure in l984-85 of $3,429, Senator Moynihan estimated.

'Largest Revenue Raiser'

The measure is expected to net the federal treasury $33.8 billion, making it the "single largest revenue raiser" in the tax-reform package, according to Senator Moynihan. The Senator, a member of the tax-writing Finance Committee, agreed that finding another way to raise those revenues is the "central question" in fighting elimination of the deductions.

Senator Moynihan was joined at the press conference by representatives of the National Education Association, the American Federation of Teachers, the Council of Great City Schools, and the National School Boards Association.

Michael Casserly of the Council of Great City Schools, a coalition of 35 of the biggest urban school districts, said the revenue-raising plan would have disastrous effects on support for minorities and poor youths in inner-city school districts.

Mary Hatwood Futrell, nea president, described the fight against the plan as a key issue both for her organization and for the Congress.

The nea's 8,000 state and local leaders plan to stress their opposition to the measure when they lobby members of Congress during the association's convention next month, she added.--jh & sh

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