President Obama Calls for Tax Increase
President Barack Obama wants to raise taxes but the Republicans don’t want to hear anything about it. The president wants Congress to remove tax breaks, lower tax rates, and make more money. His proposal will have a hard time to move through Congress.
Obama said that his proposal will protect the middle class and at the same time promote economic growth. The Republicans rejected the president’s plan and said that the country doesn’t need any tax increases.
Obama’s proposal is similar to Republican Representative Paul Ryan’s budget plan that lowers top tax rates to 25 percent and extends all income tax cuts permanently. The difference between the two plans is the amount of revenue to be collected and who are going to pay for it.
Obama wants to limit the itemized deductions at 28 percent. This would curb the benefits for taxpayers with high earners. He also supports the lowering of corporate tax rates but at the same time remove business tax breaks. On the other hand, Republicans want to decrease the budget deficits only through spending cuts.
House Speaker John Boehner said that tax hikes can destroy jobs. The deficit commission wants a tax structure that would decrease the top tax rate from 35 percent to 28 percent. It would also tax dividends and capital gains as ordinary income and convert charitable contribution deductions and mortgage interest into limited credits.