More Democrats Pushing to Keep Tax Cuts
This Tuesday, June 12, 2012, photo shows a Kroger grocery store in Dearborn, Mich. The Kroger Co. said Thursday, June 14, 2012, its net income edged up slightly in the first quarter as its customer loyalty programs helped drive up revenue. The company also raised its full-year earnings outlook. (AP Photo/Paul Sancya) / Paul Sancya
Congress seems increasingly reluctant to let taxes go up, even on wealthier Americans.
Worried about the fragile economy and their own upcoming elections, a growing number of Democrats are joining the rock-solid Republican opposition to President Barack Obama's plans to let some of the Bush administration's tax cuts expire.
Democratic leaders in Congress still back Obama, but the willingness to raise taxes is waning among the rank and file as the stagnant economy threatens the party's majority in the House and Senate.
"In my view this is no time to do anything that could be jarring to a fragile recovery," said Rep. Gerry Connolly of Virginia, a first-term Democrat.
The most sweeping tax cuts in a generation are due to expire in January, and that's setting up a showdown when lawmakers return from their summer vacations this month. By waiting to act on the tax cuts until just before congressional elections in November, Democratic leaders have raised the stakes, politically and for taxpayers.
If Congress fails to act a possibility given the gridlock that has gripped the Senate workers at every income level would face significant tax increases next year.
Taxpayers making between $40,000 and $50,000 a year would get hit with an average income tax increase of $923 next year. Those making between $50,000 and $75,000 would face an average increase of $1,126, according to estimates by the nonpartisan Joint Committee on Taxation.
Obama wants to make the tax cuts permanent for middle- and low-income families while allowing them to expire for individuals making more than $200,000 and married couples making more than $250,000.
Republicans want to make all the tax cuts permanent, adding nearly $4 trillion to the national debt over the next decade. Most Democrats in Congress support Obama's plan, but a growing number have come out in favor of extending all the reductions for a year or two, leaving the outcome very much in doubt.
"It's going to be hard to resist a one-year extension for everybody, given the state of the economy," said Clint Stretch, a tax expert at the consulting firm Deloitte Tax LLP. "That's where I think the ball is moving."
The tax cuts were enacted in 2001 and 2003 under President George W. Bush. They provided help for both rich and poor, reducing the lowest marginal rates as well as the top ones and several in between. They also provided a wide range of income tax breaks for education, families with children and married couples.
Taxes on capital gains and dividends were reduced, while the federal estate tax was gradually repealed, though only through this year.
Connolly said the nation cannot afford to make all the tax cuts permanent, which would add about $3.9 trillion to the national debt over the next decade according to updated estimates from the nonpartisan Congressional Budget Office.
"I would say certainly a year, until we feel more confident about the economic growth of this economy," he said.
Another freshman Democrat, Rep. Bobby Bright of Alabama, said he would like to see all the tax cuts extended for two or three years, if lawmakers cannot agree on a more permanent plan.
"Party leaders are not my directors or my boss," Bright said. "My boss is my constituents, and I've heard from a vast majority of my constituents that they don't believe in tax increases on anybody at this point in time."
Bright is high on the re-election endangered list, one of roughly four dozen Democrats in districts won by Republican presidential nominee John McCain in 2008.
In the Senate, where Democrats need unity and at least one Republican vote to overcome filibusters, at least three Democrats and independent Joe Lieberman of Connecticut have said they want to extend all the tax cuts temporarily.
Several Democratic candidates for Senate have also come out in favor of extending them all, including Robin Carnahan in Missouri and Jack Conway in Kentucky.
"Jack Conway was in favor of the Bush tax cuts when they first passed (in 2001 and 2003), and he's in favor of extending the Bush tax cuts now," said spokeswoman Allison Haley.
Obama first staked out his position on taxes during the presidential campaign, and his administration has been adamant that the nation cannot afford to extend the reductions for top earners.
Obama's plan would let taxes increase by a little more than $38 billion next year, with nearly 80 percent of the increase falling on families making more than $1 million, according to the Joint Committee on Taxation.
Taxpayers making between $200,000 and $500,000 would face an average tax increase of $532, according to the analysis. Those making from $500,000 to $1 million would average an increase of a little more than $9,800. Taxpayers making more than $1 million would average an increase of just over $95,000.
This week, White House economic adviser Jason Furman said it would be a bad idea to extend tax cuts for the wealthy, even for just a year, because it would open the door to making them permanent. Last week, Vice President Joe Biden said Republican claims that small businesses would be hurt by the proposed tax increase are a "bunch of malarkey."
On Thursday, White House spokesman Robert Gibbs said extending cuts for the wealthy would do little to improve the economy.
"We are focused first and foremost and only on extending tax cuts for the middle class," Gibbs said.
The most sweeping tax cuts in a generation are due to expire at
the end of the year. Congress is set to take up the issue this
month. If Congress does nothing, families at every income level
face tax increases next year.
AP Worried about the fragile economy and their own upcoming elections, a growing number of Democrats are joining the rock-solid Republican opposition to President Barack Obama's plans to let some of the Bush administration's tax cuts expire.
Democratic leaders in Congress still back Obama, but the willingness to raise taxes is waning among the rank and file as the stagnant economy threatens the party's majority in the House and Senate.
"In my view this is no time to do anything that could be jarring to a fragile recovery," said Rep. Gerry Connolly of Virginia, a first-term Democrat.
The most sweeping tax cuts in a generation are due to expire in January, and that's setting up a showdown when lawmakers return from their summer vacations this month. By waiting to act on the tax cuts until just before congressional elections in November, Democratic leaders have raised the stakes, politically and for taxpayers.
If Congress fails to act a possibility given the gridlock that has gripped the Senate workers at every income level would face significant tax increases next year.
Taxpayers making between $40,000 and $50,000 a year would get hit with an average income tax increase of $923 next year. Those making between $50,000 and $75,000 would face an average increase of $1,126, according to estimates by the nonpartisan Joint Committee on Taxation.
Obama wants to make the tax cuts permanent for middle- and low-income families while allowing them to expire for individuals making more than $200,000 and married couples making more than $250,000.
Republicans want to make all the tax cuts permanent, adding nearly $4 trillion to the national debt over the next decade. Most Democrats in Congress support Obama's plan, but a growing number have come out in favor of extending all the reductions for a year or two, leaving the outcome very much in doubt.
"It's going to be hard to resist a one-year extension for everybody, given the state of the economy," said Clint Stretch, a tax expert at the consulting firm Deloitte Tax LLP. "That's where I think the ball is moving."
The tax cuts were enacted in 2001 and 2003 under President George W. Bush. They provided help for both rich and poor, reducing the lowest marginal rates as well as the top ones and several in between. They also provided a wide range of income tax breaks for education, families with children and married couples.
Taxes on capital gains and dividends were reduced, while the federal estate tax was gradually repealed, though only through this year.
Connolly said the nation cannot afford to make all the tax cuts permanent, which would add about $3.9 trillion to the national debt over the next decade according to updated estimates from the nonpartisan Congressional Budget Office.
"I would say certainly a year, until we feel more confident about the economic growth of this economy," he said.
Another freshman Democrat, Rep. Bobby Bright of Alabama, said he would like to see all the tax cuts extended for two or three years, if lawmakers cannot agree on a more permanent plan.
"Party leaders are not my directors or my boss," Bright said. "My boss is my constituents, and I've heard from a vast majority of my constituents that they don't believe in tax increases on anybody at this point in time."
Bright is high on the re-election endangered list, one of roughly four dozen Democrats in districts won by Republican presidential nominee John McCain in 2008.
In the Senate, where Democrats need unity and at least one Republican vote to overcome filibusters, at least three Democrats and independent Joe Lieberman of Connecticut have said they want to extend all the tax cuts temporarily.
Several Democratic candidates for Senate have also come out in favor of extending them all, including Robin Carnahan in Missouri and Jack Conway in Kentucky.
"Jack Conway was in favor of the Bush tax cuts when they first passed (in 2001 and 2003), and he's in favor of extending the Bush tax cuts now," said spokeswoman Allison Haley.
Obama first staked out his position on taxes during the presidential campaign, and his administration has been adamant that the nation cannot afford to extend the reductions for top earners.
Obama's plan would let taxes increase by a little more than $38 billion next year, with nearly 80 percent of the increase falling on families making more than $1 million, according to the Joint Committee on Taxation.
Taxpayers making between $200,000 and $500,000 would face an average tax increase of $532, according to the analysis. Those making from $500,000 to $1 million would average an increase of a little more than $9,800. Taxpayers making more than $1 million would average an increase of just over $95,000.
This week, White House economic adviser Jason Furman said it would be a bad idea to extend tax cuts for the wealthy, even for just a year, because it would open the door to making them permanent. Last week, Vice President Joe Biden said Republican claims that small businesses would be hurt by the proposed tax increase are a "bunch of malarkey."
On Thursday, White House spokesman Robert Gibbs said extending cuts for the wealthy would do little to improve the economy.
"We are focused first and foremost and only on extending tax cuts for the middle class," Gibbs said.
The most sweeping tax cuts in a generation are due to expire at
the end of the year. Congress is set to take up the issue this
month. If Congress does nothing, families at every income level
face tax increases next year.
2011 Income Number of tax returns Average tax increase
Less than $10,000 28,681,000 $70
$10,000 to $20,000 24,383,000 $410
$20,000 to $30,000 18,523,000 $756
$30,000 to $40,000 15,679,000 $893
$40,000 to $50,000 13,001,000 $923
$50,000 to $75,000 23,972,000 $1,126
$75,000 to $100,000 15,245,000 $1,837
$100,000 to $200,000 16,885,000 $3,672
$200,000 to $500,000 3,757,000 $7,187
$500,000 to $1 million 608,000 $18,092
$1 million and over 315,000 $101,587
Source: Joint Committee on Taxation
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The Democrats -- including President Obama -- have always said they are going to KEEP THE TAX CUTS FOR ALL AMERICANS making less than $200,000.
This is a misleading article, but frankly -- any Dem that supports the tax cuts staying in place for the $200K and above earners shouyld be voted out of Congress.
Then they should run as the Republicans they really are.
We don't need these "elect me, that's all I care about" creeps. Being honest about your support of the MIDDLE CLASS over the Corporations and wealthy 2% is far more important than whether you have a R or a D after your name.
No - to another stimulus package. I don't think the federal government has even spent all the money allocated to the massive one Washington passed earlier.
No - to additional taxes, on anyone, in any form. This includes businesses.
Yes - to reducing the federal government to a manageable size.
Yes - to repealing the ENTIRE horrible health care bill - no tweaks - get rid of the entire bill.
don't have to worry about extending the Bush tax cuts...
those who haven't, are the ones who are starting to line up
in support of extending them! And, are marking themselves as those
who need to go...
I also see which Democrats are saying this. I hope they lose their re-election bids -- and it is likely they will. I'd rather have the Republicans control the House than have these chicken-sh#$ "my election is all I care about" types have any place in our government.
Note to Republicans: You are going to have to work with the Democrats and the President on this (finally, do some work besides forming the word "no"). Inaction and guess what? ALL the tax cuts expire... and all your promises are made into false promises... beware. That will not bode well for you, any more than it bodes well for these CS Dems...
The Dems have always said they are for extending the Bush tax cuts for those making less than $200,000.
If any of them want to keep the cuts for the wealthy -- they should be named and immediately booted out of office... they can then join the Republican party and do all they can to ruin the middle class at the behest of the rich donors they need for "my election, that is ll thet matters"!
Dang