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Obama calls for middle class tax cut extension

12:30 PM, Jul 9, 2012   |    comments
President Barack Obama in the Rose Garden at the White House on June 15, 2012.
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WASHINGTON -- President Obama revived the tax issue today, calling for a one-year extension of the George W. Bush-era tax cuts -- but only for the middle class.

In a White House ceremony, Obama said lower tax rates should end for Americans making more than $250,000 a year, citing the need to reduce the federal debt and invest it items such as education and infrastructure.

"Everybody agrees we've got to do something about these deficits and these debts," Obama said, adding that extended tax cuts for the wealthiest Americans are "least likely to promote growth."

The ceremony featured invited middle class taxpayers who, Obama said, face higher tax bills of up to $2,200 if all the Bush tax cuts expire at the end of the year.

House Republicans -- saying that ending the Bush tax cuts for the rich will hurt job creators -- plan to vote later this week on a permanent extension; the Democratic-run Senate is not expected to follow suit.

Senate Minority Leader Mitch McConnell, R-Ky., meanwhile, has called for a one-year extension of all the Bush tax cuts while Congress seeks to revamp the entire tax code.

"In this slow economy, it appears the president is going to call for a tax hike on small businesses today," tweeted McConnell spokesman Don Stewart.

The two parties agreed in 2010 to a two-year extension of all the cuts.

In the months since, Obama has accused the Republicans of seeking to protect their wealthy backers with a permanent extension of the Bush tax cuts; Republicans say Obama wants tax hikes on the very people he wants to create jobs.

Obama's latest call for ending Bush tax cuts for the wealthy comes as his campaign criticizes Republican opponent Mitt Romney for his use of offshore bank accounts; campaign aides have called for Romney to release more of his tax returns.

The New York Times, which first reported on the tax cut announcement, reports that Obama will campaign on the issuethis week:

The White House hopes to squeeze maximum political mileage out of (today's event), surrounding Mr. Obama with families and workers who would benefit from the extension. On Tuesday, he will take his message to Iowa, the battleground state that turned him into a serious presidential contender in 2008.

In Cedar Rapids, Mr. Obama plans to visit the home of Jason and Ali McLaughlin, a high school principal and an account manager at a document-scanning company, a campaign official said. The McLaughlin family, with a combined income of $82,000, would face an extra $2,000 burden next year if the tax cuts on the middle class expired as scheduled, the campaign said.

White House officials insisted that Monday's move was more than politics. They said it would ease anxiety over the "fiscal cliff" -- the combination of tax increases and automatic spending cuts that are scheduled to kick in at the end of this year. That one-two punch, economists say, could deal a heavy blow to an already tender economy unless the White House and Congress work out some kind of compromise.

(USA Today)

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