Obama calls bipartisan meeting on 'fiscal cliff,' digs in on tax hike
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Some Democratic strategists have suggested that the Democrats allow all the tax cuts to expire, then introduce legislation in the new Congress to lower rates for all except the top 2 percent of taxpayers. Republicans would be caught in a bind of either rejecting tax cuts for most Americans or approving a tax rate reduction that excludes the wealthiest Americans.
Republicans say that effectively raising taxes on the top taxpayers would harm small businesses – the engine of job growth – as many file their taxes as individuals.
“The problem with raising tax rates on the wealthiest Americans is that more than half of them are small-business owners,” Boehner said Friday, referring to a study by the accounting firm Ernst & Young indicating 700,000 jobs would be lost if the Bush tax cuts expire. “We also know that it would slow down our economy.”
Obama rejected that argument, saying that taxes would not be raised on 97 percent of small-business owners.
“While I appreciate and share the president’s desire to put the election behind us, the fact is we still have yet to hear an actual plan from the president for addressing the great economic challenges we face,” Senator McConnell said. “What’s needed now is a realistic and specific proposal from the president that can actually pass the Congress."