Congressional opposition is heating up against a White House tax panel's recommendation to reduce the home mortgage deduction.
Eight Republican members of the House Ways and Means Committee - Reps. Jerry Weller of Illinois, E. Clay Shaw and Mark Foley of Florida, Wally Herger of California, Kevin Brady of Texas, Nancy Johnson of Connecticut, Ron Lewis of Kentucky, and Eric Cantor of Virginia - sent Treasury Secretary John Snow a letter opposing the idea.
"We urge you to preserve the deductions for mortgage and home equity interest and state and local taxes which underpin homeownership and the social and economic benefits it guarantees," the Nov. 17 letter said. "The benefits of these long-standing deductions are reflected in the current, historic level of homeownership and in the quality of our nation's communities."
Under current law, taxpayers can deduct interest payments on mortgage debt of up to $1.1 million. Last month the Bush administration's Advisory Panel on Tax Reform proposed replacing the deduction with a credit for any taxpayer equal to 15% of mortgage interest paid, and capping the mortgage amount at average regional housing prices, which range from $227,000 to $412,000.
Other House members, including Reps. Steve Israel, D-N.Y., and Katherine Harris, R-Fla., also have opposed the proposed mortgage deduction.
The panel's recommendations are not be binding on the President or Congress.