Obama to propose tax hikes: I think he will focus mainly on working people by ending

[Better Believe It]

so-called "loopholes" and "tax breaks" such as the mortgage interest tax deduction. While President Obama will formally say he favors ending his two year tax cut for the rich, he won't fight for that and it will not be voted on by Congress. But, he can always say he proposed ending his tax cuts for the rich while approving legislation that will increase taxes for the working class by ending all of our "tax loopholes". BBI


Obama to propose tax hikes, spending cuts
White House says plan looks to reduce defense and healthcare spending, reform tax system
MSNBC.com
April 13, 2011

WASHINGTON — President Barack Obama — two years into a presidency that increased spending to prime a weak economy — is turning his attention to the nation's crushing debt and trying to counter a Republican anti-deficit plan with a framework of his own that tackles politically sensitive health care programs while also increasing taxes.

"The president will lay out four steps to achieve this balanced approach," a White House official said, citing defense budget savings, waste from healthcare, domestic spending control, and "tax reform that reduces spending in our tax code" — a reference to closing tax loopholes.

Another official, commenting on the condition of anonymity, said the plan borrows from the December recommendations of Obama's bipartisan fiscal commission, which proposed $4 trillion in deficit reduction over 10 years.

In a preview of the speech, the White House said it aims to achieve "balanced" deficit reduction by keeping domestic spending low, reducing the defense budget, cutting excess health care spending in the nation's biggest benefit programs, and eliminating loopholes and breaks in the tax system.

http://www.msnbc.msn.com/id/42566545/ns/politics-more_politics

[leftstreet]

1. This is how he kicks off his campaign?

Jeebus

[daa]

5. And this is how he ends it

Saving $480 billion in Medicare and Medicaid by 2023 and at least $1 trillion more by 2033.

[Name removed]

6. Deleted message

Sub-thread removed by moderator. Click here to review the message board rules.

[Angry Dragon]

2. 'so-called "loopholes" and "tax breaks" such as the mortgage interest tax deduction'

He gets rid of the mortgage deduction he can kiss home sales and a lot of the construction trades good-bye

[brooklynite]

8. My wife is a tax lawyer...

...she points out that the problem is that the tax deduction is a percentage off any mortgage expense for any primary residence. As a result, a millionaire gets a much-larger write-off for buying a mansion that a working class couple does for a starter one-bedroom.

Her view is that it's much smarter to give everyone with a mortgage a fixed amount credit based on the cost of an average middle-class residence, and if you want to buy something more opulent, you'll have to pay the difference.

[Angry Dragon]

14. That is not a bad idea

[Adsos Letter]

16. How would she account for location?

[dennis4868]

3. Makes alot of sense....

to cut excess health care spending in the nation's biggest benefit programs, and eliminating loopholes and breaks in the tax system.

[OhioChick]

4. "eliminating loopholes and breaks in the tax system" for who? n/t

[wtmusic]

7. "reduces spending in our tax code" - nominated for doublespeak award.

Even better: "tax reform including greater reverse spending".

[xchrom]

9. It's gonna be interesting. Nt

[zipplewrath]

10. I really struggle with this one

There is a case to be made that the mortgage interest tax deduction actually hurts the lower income population. There is a case to be made that it had driven housing costs up much higher than can be justified by the wealth of the nation. Furthermore, many folks in the lower economic classes aren't buying homes, or more importantly SHOULDN'T be buying them as they cannot afford them, nor have the economic stability to support such a purpose. Finally, althought the deduction often is useful in the first 10 years or so of a mortgage, more than one accountant has notice that "itemizing" becomes marginal to unnecessary for many unless they have several other qualifying deductions. There could be a useful change made to the tax code in which many if not nearly all of the deductions were excluded. However, in ONLY make sense if the "standard deduction" or the minimum income tax levels, and/or the earned income tax credit is adjusted accordingly.

I have no problem with eliminating many if not all of the deductions if we RAISE the minimum income, increase the earned income tax credit, and oh by the way, get rid of the silly "capital gains" rate of 15- 20%, especially for such gains which are functionally "salary". Under those assumptions, I'd even agree to lower "rates" for the top income brackets. But I have NO faith/trust/hope that those conditions would be met. And finally, I'd say such a system would only work if income tax rates were connected not only to INCOME but to WEALTH. Your income rate would be based not only on your annual income, but your accumulated wealth. I care less about taxing the windfall of a single years income, than I do of taxing those whose income is basically just continuing to accumulate far beyond their intention, need, or ability to spend.

[WatsonT]

11. He could end the social security cap

And increase the estate tax.

[dems_rightnow]

12. Mortgage interest- 2nd home

Hopefully he won't end the break for mortgage interest on vacation homes, or the poor and middle class will have to get by on just one home!

[SoCalDem]

20. There SHOULD be an end to some mortgage deductions

like:

everything other than the PRIMARY residence

and on "jumbo" homes, for instance.,.a mortgage that is more than 5 times your adjusted gross income.. (if your AGI is $50K, should you really be "buying" a house with a $250K mortgage?..kind of a recipe for disaster)

there is NO earthly reason why WE should subsidize flippers and profligates.


For the "regulars" who will pile on about the poor landlords who need the deduction for their "investments"..sorry.. your tenants are already paying your mortgage (or maybe you are not such a shrewd businessperson), and if you cannot afford to invest, perhaps you should not...and isn't your taxed profit determined AFTER your expenses? wouldn't a mortgage be considered part of the "expenses"?

[MineralMan]

13. Why Speculate? President Obama is just about the tell everyone.

Why not wait and see what he says. This constant negative speculation is suspect, in my opinion.

Listen to his speech and find out what he says. That seems reasonable to me today.

[ProSense]

15. So Obama is going to call for ending

"loopholes" and "tax breaks" for working people?

Yeah, there are a lot of "loopholes" and "tax breaks" in the tax code for working people.

Share that with the GOP, I'm sure they'll be interested in rebranding the end of "loopholes" and "tax breaks" as code for hurting working people.

[MineralMan]

17. As interested as you appear to be, I assume you'll be listening

intently when the President makes this speech. Right?

[SidDithers]

18. Kick...

ooops.

Sid

[dionysus]

19. you're spinning furiously after that speech. kinda transparent.