By Jonathan Weisman Washington Post Staff Writer Friday, June 23, 2006; Page A06 The House yesterday approved a deep, permanent tax cut on large, inherited estates that would cost the Treasury hundreds of billions of dollars, then sought to burnish its reputation for fiscal discipline by granting the president power to rescind pet projects from spending legislation. The twin actions, cutting taxes and approving a line-item veto, came as Congress struggles to contain stubborn budget deficits. The votes also came just days after Rep. Jeff Flake (R-Ariz.) tried and failed 31 times to strike pet projects worth more than $200 million from four spending bills that passed the House easily. The legislation, which passed 269 to 156, would exempt estates worth as much as $5 million -- $10 million for couples -- from taxation indefinitely. The tax rate on estates worth more than the exemption level up to $25 million would be set at the same tax rates that apply to capital gains -- now 15 percent but scheduled to rise to 20 percent in 2011. The tax for estates worth more than $25 million would be twice the capital gains rate. The bipartisan Joint Committee on Taxation estimated that the estate tax cut would cost the government $279 billion in revenue over the next 10 years.