Poll: Should debt deal include tax hikes for the wealthy?
President Obama took aim at tax breaks for the wealthy at his press conference today, saying, “You can afford it. You’ll still be able to ride on your corporate jet. You’re just going to pay a little more.”
Obama singled out oil and gas subsidies “for oil companies that are making money hand-over-fist” and “wealthy” CEOs and hedge fund managers. He predicted that Republican anti-tax legislators would eventually have to come around and accept some tax increases as part of a big budget-cutting/debt-ceiling-hiking compromise package. The Administration has said the U.S. would not be able to meet all of its obligations if the federal debt ceiling isn’t increased by August 2.
Senate Republican Leader Mitch McConnell has been dismissive of this approach, suggesting that the midst of a “debt crisis” is the wrong time to raise taxes and could stall jobs.
Meanwhile, down at the other end of Pennsylvania Avenue, Internal Revenue Service taxpayer advocate Nina E. Olson was renewing her call for tax reform in a report to Congress. “Unless the tax system becomes more transparent and user-friendly, taxpayers’ perceptions of fairness and ultimately their compliance with the system may continue to erode,” she said in the report.
So what are those perceptions? In January, the IRS set up a tax reform website to garner public response to the question: “What would you be willing to give up if you knew that others are giving up their breaks and the end result would be a much simpler system?”
The IRS has received some 1,500 comments so far, and posted a few that it says are “not statistically represententative” of all of the responses. Ideas include several entreaties for a flat tax and for the scrapping of the income tax altogether in favor of a consumption tax. But folks are asking for more tax breaks — for items like retiree medical expenses, Social Security benefits, student loan repayment and more. That fairness theme ran throughout what was, admittedly, a curated collection.
“I’d give up most, if not all, tax credits or deductions for a simple, fair and moderate flat tax that everyone in the country paid equally,” said one. “I do find it infuriating to learn that many of our largest corporations, with quarterly profits in the tens of millions of dollars, are paying a lower effective tax rate than I am,” said another.
So is Obama onto something? Is it time for the federal government to collect more revenue from the upper strata of American society? “The revenue we’re talking about isn’t coming out of the pockets of middle-class families that are struggling, it’s coming out of folks who are doing extraordinarily well and who are enjoying the lowest tax rates since before I was born,” Obama said.
What do you think? Take our poll.