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Wall St. set to rise at open as tax reform enters last lap

By Rama Venkat Raman

(Reuters) – Wall Street was poised to open higher on Thursday, aided by gains for banking shares and news that the Republicans’ tax code overhaul should face final votes in Congress before the year-end.

A final bill could be formally unveiled on Friday, with decisive votes expected next week in both chambers.

On Wednesday, Republicans in the Senate and the House reached a deal on final tax legislation, paving the way for final votes next week on a package that would slash the corporate tax rate to 21 percent.

“We have a pretty positive background, investors are focused on the tax deal that they are closed to an agreement between the House and the Senate,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

“It will take some time to go through the details, what that means for specific companies but it’s consistent with the general positive tone.”

Traders also focused on a $52.4 billion stock deal between Walt Disney <DIS.N> and Twenty-First Century Fox <FOXA.O>.

Shares of media baron Rupert Murdoch’s Fox fell marginally in choppy trading after Walt Disney agreed to buy the Fox’s film, television and international businesses. Disney shares were also down 0.9 percent.

Goldman Sachs <GS.N>, JPMorgan <JPM.N>, Wells Fargo <WFC.N> and Bank of America <BAC.N> rose between 0.52 percent and 0.86 percent ahead of market open.

Shares of big banks recovered early in the day from an initial decline after the Federal Reserve raised rates by 25 basis points but kept its outlook for 2018 and 2019 unchanged.

At 8:34 a.m. ET (1334 GMT), Dow e-minis <1YMc1> were up 32 points, or 0.13 percent, with 8,450 contracts changing hands.

S&P 500 e-minis <ESc1> were up 1.5 points, or 0.06 percent, with 69,766 contracts traded.

Nasdaq 100 e-minis <NQc1> were up 6 points, or 0.09 percent, on volume of 7,313 contracts.

U.S. retail sales increased more than expected in November as the holiday shopping season got off to a brisk start, pointing to sustained strength in the economy.

A Commerce Department report showed retail sales rose 0.8 percent in November, while economists polled by Reuters has forecast a 0.3 percent rise.

Among other big movers, Express Scripts <ESRX.O> gained about 2 percent after pharmacy benefit manager forecast full-year 2018 earnings that topped analysts’ expectations.

U.S.-listed shares of Valeant Pharmaceuticals <VRX.N> fell 4.2 percent after JPMorgan cut the stock’s rating to ‘underweight’.

Israel-based drugmaker Teva Pharmaceutical’s <TEVA.N> shares soared 15 percent after the company announced job cuts, asset sale and dividend suspension in an overhaul to pay back debt.

(Reporting by Rama Venkat Raman in Bengaluru; Editing by Arun Koyyur)

Putin must nudge Syria into U.N. peace deal, mediator says

By Stephanie Nebehay

GENEVA (Reuters) – U.N. Special Envoy for Syria Staffan de Mistura urged Russia on Wednesday to convince its ally the Syrian government of the need to clinch a peace deal to end the nearly seven-year-old war.

De Mistura, speaking on Swiss television station RTS, said failure to make peace quickly through United Nations mediation could lead to “a fragmentation of Syria”.

Russian President Vladimir Putin during a surprise visit on Monday to Russia’s Hmeymim air base in Syria, declared that the work of Russian forces was largely done in backing the Assad government against militants, following the defeat of “the most battle-hardened group of international terrorists.”

De Mistura, asked what signal Putin could give from his position of force, said: “Convince the (Syrian) government that there is no time to lose…. You can think you win territory militarily but you have to win the peace.

“And to win the peace, you have to have the courage to push the government to accept that there has to be a new constitution and new elections, through the United Nations,” he said.

The nearly seven-year civil war in Syria has killed hundreds of thousands of people and driven more than 11 million from their homes. All previous diplomatic efforts to resolve the conflict have ended in failure over the opposition’s demand that President Bashar al-Assad leave power and his refusal to go.

The Kremlin first launched air strikes in Syria in September 2015 in its biggest Middle East intervention in decades, turning the tide of the conflict in Assad’s favor.

Now that it regards that mission complete, Putin wants to help broker a peace deal and is keen to organize a special event in Russia – a Syrian Congress on National Dialogue – that Moscow hopes will bring together the Syrian government and opposition and try to hammer out a new constitution.

But De Mistura made clear that peace negotiations must be through the United Nations in Geneva, as mandated by the U.N. Security Council, adding: “Otherwise it is not worth it…. This is a complicated war, it is only in Geneva through the U.N.”

The U.N. envoy has conducted shuttle diplomacy between the Syrian government delegation led by chief negotiator Bashar al-Ja’afari and a unified opposition delegation.

“The opposition told me clearly when they arrived here, and again yesterday and this morning too, that they are ready to meet the government right away to have a hard, difficult discussion.

“The government is not ready, it has said it is not ready to meet the opposition. That is regrettable but diplomacy has many means,” de Mistura said.

A senior Western diplomat said that the government delegation had failed to engage with de Mistura on a new constitution and elections during a round of negotiations due to end on Thursday.

“Clearly they did not have any intention to engage in this political process. And clearly they are not under sufficient pressure to do so,” the diplomat told Reuters. “The clear impression is the regime wants to avoid the U.N.-led political process at any cost.”

(Reporting by Stephanie Nebehay; Editing by Peter Graff)

Federal Communications Commission set to reverse net neutrality rules

By David Shepardson

WASHINGTON (Reuters) – The U.S. Federal Communications Commission is expected on Thursday to rescind net neutrality rules championed by Democratic former President Barack Obama that barred the blocking or slowing of internet traffic.

The 2015 rules barred broadband providers from blocking or slowing access to content or charging consumers more for certain content. They were intended to ensure a free and open internet, give consumers equal access to web content and prevent broadband service providers from favoring their own content. Chairman Ajit Pai proposes allowing those practices as long as they are disclosed.

Internet service providers clashed with Democrats and celebrities like “Star Wars” actor Mark Hamill ahead of a vote this week as the battle over net neutrality stretched from Hollywood to Washington.

Protesters including some members of Congress are expected to rally outside the FCC in Washington before the vote.

Pai’s proposal marks a victory for big internet service providers such as AT&T Inc, Comcast Corp and Verizon Communications Inc that opposed the rules and gives them sweeping powers to decide what web content consumers can get. It is a setback for Google parent Alphabet Inc and Facebook Inc, which had urged Pai not to rescind the rules.

Michael Powell, a former FCC chairman who heads a trade group representing major cable companies and broadcasters, told reporters that internet providers would not block content because it would not make economic sense and consumers would not stand for it.

“They make a lot of money on an open internet,” Powell said, adding it is “much more profitable” than a closed system. “This is not a pledge of good-heartedness, it’s a pledge in the shareholders’ interest.”

A University of Maryland poll released this week found that more than 80 percent of respondents opposed the proposal. The survey of 1,077 registered voters was conducted online by the Program for Public Consultation at the University of Maryland from Dec. 6-8.

Democrats have said the absence of rules would be unacceptable and that they would work to overturn the proposal if it is approved. Advocates of the net neutrality rules also plan a legal challenge.

Pai’s proposal is “like letting the bullies develop their own playground rules,” said Senator Ed Markey, a Massachusetts Democrat.

Many Republicans back Pai’s proposal but want Congress to write net neutrality rules. Senate Majority Leader Mitch McConnell said the FCC would “return the internet to a consumer-driven marketplace free of innovation-stifling regulations.”

A group of nearly 20 state attorneys general asked the FCC to delay the vote until the issue of fake comments is addressed.

(Reporting by David Shepardson; Editing by Chris Sanders and Lisa Shumaker)

Israel closes Gaza border crossings after Palestinian rocket strikes

JERUSALEM (Reuters) – Israel announced the closure of its Gaza border crossings on Thursday in response to daily rocket fire from the enclave over the past week after U.S. President Donald Trump’s recognition of Jerusalem as Israel’s capital stoked Palestinian anger.

Israeli aircraft struck three facilities belonging to Hamas, the militant group that controls the Gaza Strip, before dawn on Thursday after the latest rocket attacks, Israel’s military said.

It said it targeted training camps and weapons storage compounds. Hamas usually evacuates such facilities when border tensions spike.

Two of the rockets fired by militants were intercepted by Israel’s Iron Dome anti-missile system and a third exploded in an open area. There were no reports of casualties on either side of the frontier.

The military said in a statement that “due to the security events and in accordance with security assessments” Kerem Shalom crossing – the main passage point for goods entering the Gaza Strip, and the Erez pedestrian crossing – would be shut as of Thursday. It did not say how long the closure would last.

Some 15 rockets have been fired into southern Israel since Trump’s Dec. 6 announcement, and none of the projectiles has caused serious injury or damage.

The attacks have drawn Israeli air strikes that have killed two Hamas gunmen. Two other Palestinians have been killed in confrontations with Israeli troops during stone-throwing protests along the border.

Israeli cabinet minister Tzachi Hanegbi said on Israel Radio that while Hamas, which last fought a war with Israel in 2014, was not carrying out the rocket strikes, it needed to rein in militants from “breakaway groups” or it would “find itself in a situation where it has to contend” with the Israeli military.

In Istanbul on Wednesday, a summit of more than 50 Muslim countries condemned Trump’s move and called on the world to respond by recognizing East Jerusalem, captured by Israel along with the West Bank in a 1967 war, as the capital of Palestine.

Trump’s declaration has been applauded by Israeli Prime Minister Benjamin Netanyahu as a recognition of political reality and Jews’s biblical links to Jerusalem, a city that is also holy to Muslims and Christians.

(Reporting by Nidal al-Mughrabi and Jeffrey Heller; Writing by Jeffrey Heller; Editing by Edmund Blair)

Ohio passes law barring abortion over Down syndrome diagnosis

By Kim Palmer

CLEVELAND (Reuters) – Women in Ohio would be prohibited from receiving abortions because of a fetal Down syndrome diagnosis under a bill that passed the state senate on Wednesday and is heading to Republican Governor John Kasich’s desk.

Lawmakers voted 20-12 in favor of the law, which criminalizes abortion if the physician has knowledge that the procedure is being sought due to a diagnosis of Down syndrome, a genetic disorder caused when abnormal cell division results in an extra full or partial copy of chromosome 21.

Doctors would lose their medical licenses in the state and face a fourth-degree felony charge under the law if they were to perform an abortion with that knowledge. Mothers would not face criminal charges.

The bill makes Ohio the third state to pass a law outlawing abortions due to fetal anomalies. Similar laws were passed in Indiana and North Dakota. The Indiana provision was struck down by a U.S. District Judge in September after a lawsuit filed by the American Civil Liberties Union.

Kasich spokesman Jon Keeling declined to say whether the governor would sign the measure into law. He added that when Kasich was asked about a similar bill in the Ohio House, he had called it “appropriate.”

Abortion opponents cheered the move and said they expected the governor to sign the law.

“Every Ohioan deserves the right to life, no matter how many chromosomes they have,” said Mike Gonidakis, president of Ohio Right to Life.

Abortion-rights supporters wore “STOP THE BANS” T-shirts in the Senate chamber on Wednesday as the vote went forward.

The law “will create a chilling effect on the medical profession in our state and could result in a shortage of gynecologists willing to practice in Ohio,” Kellie Copeland, executive director of NARAL Ohio, an abortion-rights advocacy group, said in a phone interview on Wednesday.

The ACLU of Ohio said it was still evaluating the final bill before deciding whether to pursue legal action.

Kasich has 10 days to sign the bill into law after it is delivered to his office. If he does so, it will mark the 20th piece of Ohio legislation restricting abortion rights and funding for reproductive health passed in the six years he has been governor.

Unlike many other anti-abortion laws in the state, the Down syndrome bill did not pass strictly along party lines, with some Republicans joining the entire Democratic caucus in voting against the measure.

(Reporting by Kim Palmer; Editing by Patrick Enright and Matthew Lewis)

China says war must not be allowed on Korean peninsula

By Ben Blanchard

BEIJING (Reuters) – War must not be allowed to break out on the Korean peninsula and the issue must be resolved through talks, Chinese President Xi Jinping said on Thursday, while U.N. Secretary-General Antonio Guterres warned of the danger of “sleepwalking” into conflict.

Xi made his comments to visiting South Korean President Moon Jae-in just days after U.S. Secretary of State Rex Tillerson offered to begin direct talks with North Korea without pre-conditions.

But the White House said on Wednesday that no negotiations could be held with North Korea until it improved its behavior. The White House has declined to say whether President Donald Trump, who has taken a tougher rhetorical line toward North Korea, approved Tillerson’s overture.

Russian President Vladimir Putin said Tillerson’s offer of direct contacts with North Korea was “a very good signal”, while warning that a U.S. strike on the North would have catastrophic consequences.

North Korea tested its most advanced intercontinental ballistic missile on Nov. 29, which it said could put all of the United States within range, in defiance of international pressure and U.N. sanctions.

While South Korea and China share the goal of getting North Korea to give up its nuclear weapons and stop testing increasingly sophisticated long-range missiles, the two have not seen eye-to-eye on how to achieve this.

Meeting in Beijing’s Great Hall of the People, Xi told Moon that the goal of denuclearising the Korean peninsula must be stuck to, and that war and chaos cannot be allowed to happen, state media said.

“The peninsula issue must in the end be resolved via dialogue and consultation,” Xi was cited as saying.

China and South Korea have an important shared interest in maintaining peace and stability, and China is willing to work with South Korea to prevent war and promote talks, Xi added.

China would support North and South Korea to improve relations as this was good for easing tension, he said.

Xi’s warm tone followed nearly a year of tense relations between the two countries.

‘DRAMATIC CIRCUMSTANCES’

China has been furious about the deployment of the U.S.-made Terminal High Altitude Area Defence (THAAD) anti-missile system in South Korea, saying its powerful radar can see far into China and will do nothing to ease tension with North Korea.

China and South Korea agreed in late October that they would normalize exchanges and move past the dispute over THAAD, which froze trade and business exchanges, and Moon has been keen to put the dispute behind them.

Xi reiterated China’s position on THAAD and said he hoped South Korea would continue to “appropriately handle” the issue.

Guterres, speaking to reporters in Tokyo after meeting Japanese Prime Minister Shinzo Abe, said Security Council resolutions on North Korea’s nuclear and missile programs must be fully implemented by Pyongyang and other countries.

“It is very clear that the Security Council resolutions must be fully implemented, first of all by North Korea, but by all other countries whose role is crucial to … achieve the result we all aim at, which is the denuclearization of the Korean peninsula,” Guterres said.

He added that Security Council unity was also vital “to allow for the possibility of diplomatic engagement” that would allow denuclearization to take place.

“The worst possible thing that could happen is for us all to sleepwalk into a war that might have very dramatic circumstances,” Guterres said.

He said he expected a meeting of the U.N. Security Council on Friday would deliver a strong expression of unity and the need for diplomacy to resolve the issue.

Japan says now is the time to keep up maximum pressure on North Korea, not start talks on its missile and nuclear programs.

China and Russia, however, have welcomed Tillerson’s overture.

Russian President Vladimir Putin said a strike on North Korea by the United States would have catastrophic consequences and that he hoped to work with Washington eventually to resolve the crisis on the Korean peninsula.

Russia does not accept North Korea’s nuclear status, Putin told an annual news conference. But he also said that some of Washington’s past actions had provoked North Korea into violating a 2005 pact to curb its nuclear program.

“We believe the two sides should now stop aggravating the situation,” Putin said.

North Korea justifies its weapons programs as necessary defense against U.S. plans to invade. The United States, which has 28,500 troops in South Korea, a legacy of the 1950-53 Korean war, denies any such intention.

(Additional reporting by Linda Sieg in TOKYO,; Denis Pinchuk in MOSCOW and Christine Kim in SEOUL; Writing by Robert Birsel; Editing by Clarence Fernandez)

Congress secures tax deal, Trump backs 21-percent corporate rate

By David Morgan and Amanda Becker

WASHINGTON (Reuters) – Congressional Republicans have reached a deal on final tax legislation, the U.S. Senate’s top Republican tax writer said on Wednesday, with President Donald Trump saying he would back a sharply lowered corporate tax rate of 21 percent.

The 21 percent rate would be slightly above a proposed 20-percent rate that Trump supported earlier, but still far below the present headline rate of 35 percent, a deep tax cut that U.S. corporations have been seeking for years.

As they finalized the biggest tax overhaul in 30 years, Republicans for weeks wavered on slashing the top income tax rate for the rich, but finally agreed to do it, despite Democrats’ criticism that the bill favors the wealthy and corporations, while offering little to the middle class.

The emerging congressional agreement includes a 21-percent corporate rate; a top individual income tax rate of 37 percent, down from the current 39.6 percent level; and a $10,000 cap on deducting state and local property or income tax payments, said sources familiar with the negotiations.

Although the president said a “final number” on the corporate rate had not been set, the Senate and House of Representatives were hurtling toward an agreement that would clear the way for final votes in both chambers next week.

“I think we’ve got a pretty good deal,” Senate Finance Committee Chairman Orrin Hatch told reporters as he prepared to join other Republicans for lunch with Trump.

Hatch’s remarks appeared to reinforce expectations that a final vote could begin in the Senate as early as Monday. Further details of the agreed legislation were not yet available.

Republicans have been urgently trying to finalize details of their bill without increasing its estimated impact on the federal deficit. As drafted, it is expected to add as much as $1.5 trillion to the $20-trillion national debt over 10 years.

At a tax event held by Democrats, Moody’s Analytics Chief Economist Mark Zandi said the Republican bill, if enacted, would cause interest rates to rise, meaning the benefits of a lower corporate tax rate would be “completely washed out.”

Stock markets have rallied for months in anticipation of lower taxes for businesses. The benchmark Dow Jones Industrial Average Index <.DJI> was up 0.5 percent at 24,628 in afternoon trading.

“The market is trading at all-time highs, its run-up has been really in anticipation of tax reform,” said Ken Polcari, NYSE floor division director at O’Neil Securities in New York.

CORKER UNDECIDED

Republican Senator Bob Corker, a fiscal hawk, on Wednesday said he was undecided on whether to support the bill. He told reporters: “My deficit concerns have not been alleviated.”

Asked at the lunch by reporters if he would sign a bill with a 21-percent corporate tax rate, Trump said: “I would … It’s very important for the country to get a vote next week.”

With their defeat on Tuesday in an Alabama special Senate election, Republicans were under increased pressure to complete their tax overhaul before Christmas and before a new Democratic Alabama senator can be formally seated in the Senate.

Democrat Doug Jones’ capture of the Alabama Senate seat came hours ahead of the final tax agreement being hammered out.

When Jones, who upset Republican Roy Moore in the deeply conservative Southern state, arrives in Washington, the Republicans’ already slim Senate majority will narrow to 51-49, further complicating Trump’s legislative agenda.

Fast action by Republicans on taxes would prevent Jones from upsetting the expected vote tallies on this bill since he will not likely be seated until late December or early January.

Senate Democratic Leader Chuck Schumer called on Republicans to delay a vote on overhauling the tax code for the first time in 30 years until Jones can be seated, but that was unlikely.

A one-percentage-point change in the corporate rate would give tax writers about $100 billion of revenues over a decade that could be used in many ways. One could be to repeal a federal tax on inheritances paid by wealthy Americans. Another might be to end the corporate alternative minimum tax.

Some Republicans also wanted a slightly higher corporate rate to pay for a higher child tax credit. Lawmakers had also debated capping a popular individual deduction for mortgage interest at $750,000 in home loan value, instead of $1 million.

If Trump can sign a tax bill by the end of the year, it would be the first major legislative victory for him and the Republicans since they took control of the White House and both chambers of Congress in January.

After his lunch with Republican lawmakers, Trump will speak on tax legislation alongside five middle class families who would benefit, senior administration officials said.

He wants to try to counter claims that the Republican tax plan would largely benefit corporations and the wealthy.

The nonpartisan Joint Committee on Taxation and Congressional Budget Office have both said wealthier taxpayers would gain disproportionately from the Republican proposals.

(Additional reporting by Jeff Mason, Steve Holland, Susan Cornwell, Richard Cowan, Makini Brice and Doina Chiacu; Editing by Kevin Drawbaugh and James Dalgleish)

Tillerson says U.S. ready to talk to North Korea; Japan wants pressure

By David Brunnstrom and Christine Kim

WASHINGTON/SEOUL (Reuters) – U.S. Secretary of State Rex Tillerson offered to begin direct talks with North Korea without pre-conditions, backing away from a key U.S. demand that Pyongyang must first accept that giving up its nuclear arsenal would be part of any negotiations.

Tillerson’s new diplomatic overture comes nearly two weeks after North Korea said it had successfully tested a breakthrough intercontinental ballistic missile (ICBM) that put the entire United States mainland within range of its nuclear weapons.

“Let’s just meet,” Tillerson said in a speech to Washington’s Atlantic Council think tank on Tuesday.

The White House later issued an ambiguous statement that left unclear whether President Donald Trump – who has said Tillerson was wasting his time pursuing dialogue with North Korea – had given his approval for the speech.

“The president’s views on North Korea have not changed,” the White House said. “North Korea is acting in an unsafe way … North Korea’s actions are not good for anyone and certainly not good for North Korea.”

In Beijing, Chinese Foreign Ministry spokesman Lu Kang said China welcomed all efforts to ease tension and promote dialogue to resolve the problem.

China hopes the United States and North Korea can meet each other halfway and take meaningful steps on dialogue and contact, he told reporters.

Ahead of Tillerson’s speech, North Korean leader Kim Jong Un vowed to develop more nuclear weapons while personally decorating scientists and officials who contributed to the development of Pyongyang’s most advanced ICBM, state media said on Wednesday.

Kim said on Tuesday the scientists and workers would continue manufacturing “more latest weapons and equipment” to “bolster up the nuclear force in quality and quantity”, the KCNA news agency said.

“PERIOD OF QUIET”

While reiterating Washington’s long-standing position that it cannot tolerate a nuclear-armed North Korea, Tillerson said the United States was “ready to talk any time they’re ready to talk”, but there would first have to be a “period of quiet” without nuclear and missile tests.

United Nations political affairs chief Jeffrey Feltman, who visited Pyongyang last week, said senior North Korean officials did not offer any type of commitment to talks, but he believed he left “the door ajar”.

“Time will tell what was the impact of our discussions, but I think we have left the door ajar and I fervently hope that the door to a negotiated solution will now be opened wide,” Feltman told reporters after briefing the U.N. Security Council on Tuesday.

Not everyone is ready for talks.

Japan has advocated a strategy of pressuring North Korea through sanctions to give up its nuclear weapons. Tokyo and Washington are in “100 percent” agreement on that stance, Chief Cabinet Secretary Yoshihide Suga said on Wednesday, when asked about Tillerson’s comments.

A former Japanese diplomat said that, while a diplomatic solution was the “only acceptable solution”, now was not the time for talks.

“We have to see the effects of sanctions on life in North Korea,” the former diplomat, who asked not to be identified, told Reuters.

“I heard that they are having a serious impact on everyday life. Let’s wait and see. If we were to hint anything for dialogue, we’d be losing clout.”

South Korea continued military exercises with the United States to check military readiness, exercises the North describes as preparation for war. The South’s army said separately on Wednesday it conducted a successful air-to-air missile firing drill from Apache helicopters.

U.S. TALKS TO CHINA

Tillerson also disclosed the United States had been talking to China about how to secure North Korea’s nuclear weapons in the event of a collapse of the government in Pyongyang. He said Beijing had been given assurances that if U.S. forces had to cross into North Korea they would pull back across the border into the South.

Chinese spokesman Lu would not directly answer a question about those comments, but said China had always clearly told all its interlocutors on the issue that “There can be neither war nor chaos” on the Korean peninsula.

Tillerson made clear that the United States wants to resolve the North Korea standoff through peaceful diplomacy and, in terms far more tempered than Trump’s recent threats against Pyongyang, offered to hold exploratory talks.

“We can talk about the weather if you want,” he said. “We can talk about whether it’s going to be a square table or a round table. Then we can begin to lay out a map, a road map, of what we might be willing to work towards.”

Tillerson – whose influence has appeared to wane within the administration – said Trump “has encouraged our diplomatic efforts”.

Trump said on Twitter in October that Tillerson was “wasting his time trying to negotiate with Little Rocket Man”, using his derisive nickname for Kim.

North Korea, for its part, has made clear it has little interest in negotiations with the United States until it has developed the ability to hit the U.S. mainland with a nuclear-tipped missile, something most experts say it has still not proved.

Tillerson also said the United States was working to tighten enforcement of international sanctions against North Korea, especially further measures that China can apply, and that Washington had a full menu of military options if such a response was needed.

Daryl Kimball, executive director of the non-partisan Arms Control Association, said Tillerson’s proposal was overdue but added, “In order to get to such talks going, the U.S. side as well as North Korea must demonstrate more restraint”.

For multimedia cover on North Korea: https://www.reuters.com/north-korea/

(Additional reporting by Matt Spetalnick in WASHINGTON, Michelle Nichols at the UNITED NATIONS, Ben Blanchard in BEIJING and Tim Kelly and Linda Sieg in TOKYO; Writing by Lincoln Feast; Editing by Paul Tait and Clarence Fernandez)

Trump to make final tax push as Republican negotiators near deal

By Amanda Becker and Steve Holland

WASHINGTON (Reuters) – U.S. President Donald Trump will make a final push on Wednesday to shepherd a Republican tax overhaul across the finish line, hosting congressional negotiators for lunch before a speech in which he will make closing arguments for the legislation.

Republican tax writers from the Senate and House of Representatives worked into Tuesday evening to reconcile differences between the separate plans passed by each chamber, as important details, including a final corporate tax rate, remained in flux.

Republican leaders are aiming to vote on the sweeping legislation before Christmas. That timetable became more crucial after Tuesday’s upset win by Democrat Doug Jones over Republican Roy Moore in Alabama’s special U.S. Senate election.

Jones’ victory trims the Republicans’ already narrow Senate majority to 51-49, which could make it more difficult for them to push through legislation.

Senate Democratic Leader Chuck Schumer on Wednesday will call on Republicans to delay the tax vote until the newest senator can be seated, likely in early January.

Republicans were still trying to finalize important details without increasing the deficit impact of legislation, which could add as much as $1.5 trillion to the national debt over the next decade, according to independent estimates.

Both House and Senate bills proposed slashing the corporate rate to 20 percent from 35 percent, but negotiators were discussing on Tuesday whether to raise that rate to 21 percent in the final bill, lawmakers said.

Tax writers were also still determining a top rate for individual taxpayers and weighing how to best scale back popular individual deductions for mortgage interest and local tax payments that the Senate and House bills treated differently.

“We’re still talking,” No. 2 Senate Republican John Cornyn said late Tuesday of a possible 21 percent corporate rate.

Trump is seeking to sign a tax bill by the end of the year to achieve Republicans’ first major legislative victory since they took control of both chambers of Congress and the White House in January.

After hosting Republican lawmakers for lunch, Trump will deliver his speech on tax legislation alongside five middle class families who would benefit, senior administration officials said.

He was expected to counter claims the Republican tax plan would largely benefit corporations and the wealthy by highlighting how it would also cut rates for lower- and middle-income taxpayers, who could see additional benefits, such as higher wages, result from the corporate rate cut, the officials said.

Independent government analyses by the nonpartisan Joint Committee on Taxation, which assists congressional tax writers, and the Congressional Budget Office, which examines the budget impact of legislation, both concluded that wealthier taxpayers would disproportionately benefit from the Republican proposals.

When asked who stands to benefit most from Republican tax legislation, more than half of American adults selected either the wealthy or large U.S. corporations, according to a Reuters/Ipsos poll released on Monday.

(Additional reporting by Susan Cornwell, Richard Cowan, Doina Chiacu; Editing by Cynthia Osterman and Steve Orlofsky)

U.N. envoy urges Security Council to visit Myanmar, Bangladesh

By Michelle Nichols

UNITED NATIONS (Reuters) – A top U.N. official recounted to the Security Council on Tuesday “heartbreaking and horrific accounts of sexual atrocities” by Myanmar soldiers against Rohingya Muslim women, urging the body to visit the region and demand an end to attacks on civilians.

Pramila Patten, special envoy of U.N. Secretary-General Antonio Guterres on sexual violence in conflict, said one woman told her she was held by Myanmar troops for 45 days and raped repeatedly, while another woman could no longer see out of one eye after it was bitten by a soldier during a sexual assault.

“Some witnesses reported women and girls being tied to either a rock or a tree before multiple soldiers raped them to death,” Patten told the Security Council.

“Some women recounted how soldiers drowned babies in the village well. A few women told me how their own babies were allegedly thrown in the fire as they were dragged away by soldiers and gang raped,” she said.

Patten said the 15-member Security Council should visit Myanmar – also known as Burma – and Cox’s Bazar in Bangladesh, where more than 626,000 refugees have fled to since violence erupted in Myanmar’s northern Rakhine State on Aug. 25.

She said that a Security Council resolution demanding an immediate end to violations against civilians in Rakhine state and outlining measures to hold the perpetrators accountable “would send an important signal.”

Myanmar’s army released a report last month denying all allegations of rapes and killings by security forces.

“This is unacceptable,” said U.S. Ambassador to the United Nations Nikki Haley. “Burma must allow an independent, transparent and credible investigation into what has happened.”

“While we are hearing promises from the government of Burma, we need to see action,” she said.

Myanmar has been stung by international criticism for the way its security forces responded to Aug. 25 attacks by Rohingya militants on 30 security posts. Last month the Security Council urged the Myanmar government to “ensure no further excessive use of military force in Rakhine state.”

China’s Deputy U.N. Ambassador Wu Haitao said the crisis had to be solved through an agreement between Myanmar and Bangladesh and warned that any solution “reached under strong pressure from outside may ease the situation temporarily but will leave negative after effects.”

The two countries signed an agreement on voluntary repatriation Nov. 23. U.N. political affairs chief Jeffrey Feltman pushed on Tuesday for the United Nations to be involved in any operation to return Rohingya.

“Plans alone are not sufficient. We hope Myanmar will draw upon the wealth of expertise the U.N. can offer,” Feltman told the Security Council.

(Reporting by Michelle Nichols; Editing by Tom Brown)

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