WASHINGTON -- A group of 11 associations representing state and local interests is urging Congress to kill a proposal to simplify tax accounting rules for partnerships, because it would seriously erode the principle behind tax exemption for municipal bonds.

"We believe that what would be gained in simplification from this provision would be far outweighed by what represents a significant policy change in the tax treatment of tax-exempt debt, and we cannot condone it," the group said in letters sent last week to every member of the House Ways and Means and Senate Finance Committees.

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