Sept. 14 (Bloomberg) -- U.S. House Republican leaders said they would seek to pass a $70 billion tax-cutting measure that would extend a 15 percent rate on dividends beyond 2008, an effort that faces opposition in the Senate as the costs of Hurricane Katrina escalate.

``We need to stimulate the economy,'' House Speaker Dennis Hastert said today. Louisiana Representative Jim McCrery, a Republican member of the Ways and Means Committee, said House Republicans ``have not given up'' on extending the 2003 dividend tax cut, though he acknowledged there is dwindling support for the effort in the Senate.

The exploding cost of Hurricane Katrina and the storm's disproportionate impact on impoverished Gulf Coast residents have raised doubts that the tax-cut package could withstand a possible Senate filibuster, a parliamentary blocking tactic requiring 60 votes to overcome. Republicans have 55 seats in the 100-member Senate.

Lawmakers already have delayed action on the measure until October because of the storm and some senators have suggested they wouldn't support it.

Montana Senator Max Baucus, the top Democrat on the Finance Committee, said Monday that Hurricane Katrina had ``very significantly recast'' the debate over the tax cuts. The delay means lawmakers will have less time to debate it, he said, and that debate is likely to be colored by ``humanitarian needs, poor people's needs.''

Senate

Even some Republicans who supported President George W. Bush's tax cuts in the past, such as Ohio Senator George Voinovich, a Republican, say they're leaning against doing so now.

``This is not the time'' to pass the tax cuts, Voinovich said yesterday, citing rising budget pressures from Katrina, the war in Iraq and providing a prescription drug benefit to senior citizens.

Katrina struck the Gulf Coast on Aug. 29, possibly killing thousands. It caused an estimated $100 billion in damage and left 80 percent of New Orleans submerged in water.

More than two dozen expiring tax cuts are competing for inclusion in the $70 billion package, including extension of the dividend tax break that was created in 2003. Other tax cuts include a research credit worth $5 billion annually for companies such as Microsoft Corp. and Boeing Co. and a temporary measure limiting the reach of the alternative minimum tax.

To contact the reporter on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net

Last Updated: September 14, 2005 12:10 EDT