Obama tells congress: Don’t hold economy hostage
In his weekly Saturday address, President Barack Obama said Congress should enact compromise tax cut legislation and not hold “our entire economy hostage.” So today he called on Congress take action now on his proposal to extend current tax rates on the first $250,000 of all annual incomes — while allowing rates on any income over that amount to revert to where they were before temporary tax cuts were enacted during the administration of former President George W. Bush. Upi
“Under my plan, 97 percent of small business owners would avoid getting hit with any income tax hike whatsoever,” he said. “In fact, I’ve cut taxes for small businesses 18 times since I’ve been President. And just this week, I ordered a series of new steps to help our small businesses grow and hire.
“The only place we disagree is whether we keep giving tax cuts to the wealthiest 2 percent of Americans,” Obama said. “Republicans in Washington want more of those tax cuts. With the deficit we have, I don’t think we can afford them.” Upi
So when I read he claims he lowered the taxes 18 times, I did a bit more research, and found the following is true:
If you look at Obama’s list, you quickly realize that all but four have either expired or will soon expire, aren’t cuts at all, or are double-counted. And the rest are pretty much worthless. Obama still counts tax cuts that have already expired. The tax credit for hiring unemployed workers, enacted as part of the so-called HIRE act in 2010, is gone. So too is the break for estimated tax payments and the expanded deduction of health care expenses for the self-employed.
But several tax cuts are do to expire at the end of the year, such as bonus depreciation, expanded expensing rules, a five-year carry-back rule for business credits, and capital gains exclusions. He also counts the mere extension of a bonus depreciation rule as a tax cut, and counts the two subsequent extensions as two more cuts. He double counts other breaks as well.
Yet other taxes he claims for business is in fact complicated.
One of these makes it easier to deduct cellphone costs and another limits penalties for errors in tax reporting. But these two changes will cut small-business taxes a grand total of just $567 million over the next decade.
Obama then told listeners that Republicans
in Congress and presumptive GOP presidential nominee Mitt Romney argue “the best way to create prosperity is to let it trickle down from the top. They believe that if we spend trillions more on tax cuts for the wealthy, it’ll somehow create jobs — even if we have to pay for it by gutting education and training and by raising middle-class taxes.”
However he said “we already tried it that way for most of the last decade, and it didn’t work.” Upi
He further added that it was time for congress to compromise and stop holding the economy hostage, while we debate the merits of another tax cut for the wealthy. Let’s skip the unnecessary drama, the needless delays and all the partisan posturing and let’s just do the right thing for the people who sent us here to serve.
Meanwhile, Obama keeps trying to downplay claiming just 3% of small businesses would face higher tax bills. (Even if that were true, it would mean 900,000-plus small firms would see their tax bills climb.)