Daily Tax Update - June 29, 2011: Obama: Revenue Raisers Must Be In The Mix

OBAMA:  REVENUE RAISERS MUST BE IN THE MIX:  In remarks today, President Obama called on Republicans to drop their opposition to tax increases as part of the deficit reduction/debt ceiling talks.  Obama said that both Democrats and Republicans must be willing to "take on their sacred cows and do tough things" in order to reach an agreement on deficit reduction and the debt ceiling. 

  • Obama reiterated his stance that revenue increases should be on the table and said that he would work "as long as it takes" to get an agreement with Republicans.  The President said, "We're going to have to tackle spending in the tax code.  It would be nice if we could keep every tax break there is, but we've got to make some tough choices here if we want to reduce our deficit."  The President said that refusal to consider increased revenues is "not sustainable."  The President added, “You cannot reduce the deficit the amount that we need to without having revenues in the mix.”
  • The President added, "If by the end of this week we have not seen substantial progress, members of Congress are going to have to start canceling things and stay here until we get it done.  They're in one week, they're out the next."
  • The President criticized Republicans for refusing to agree to end certain tax breaks.  The President said, "There's been a lot of discussion about revenues and raising taxes in recent weeks, so I want to be clear about what we're proposing here . . . . The tax cuts I'm proposing we get rid of are tax breaks for millionaires and billionaires, tax breaks for oil companies and hedge fund managers and corporate jet owners."  Obama added, "You can still ride on your corporate jet.  You're just going to pay a little more. . . Everyone else has moved off their maximalist positions. . . [Republicans] need to do the same."
  • On the issue of the debt ceiling, the President said, "Nobody wants to see the US default.  We have to do it soon."
  • House Speaker John Boehner said again last night that he opposes any tax increase as part of a deal.  Boehner said, "There are no votes in the Congress . . . to raise taxes on anyone, so tax increases are off the table."
  • Meanwhile, Senate Budget Chairman Kent Conrad said this week that he believes Republicans might be supportive of controversial revenue raisers if Democrats provide permanent relief from the alternative minimum tax.  Conrad said, "The alternative minimum tax is in the law now, and we’re going to have to reform it.  That is going to lose revenue.  Replacing that revenue is clearly not a tax increase.  And you’re talking, you know, between $600 [billion] and $700 billion right there of revenue that’s not a tax increase.  It’s simply replacing revenue that’s already in the code."  Conrad added, "That’s a big chunk of the $1.1 trillion [of revenue] we need."  Conrad also said he’s pushing to eliminate offshore tax havens that he said allow companies effectively to cheat on their taxes.

TAX BILLS INTRODUCED JUNE 28TH:

1. [112nd] S.1285 : A bill to amend the Internal Revenue Code of 1986 to extend and modify the credit for new qualified hybrid motor vehicles, and for other purposes.
Sponsor: Sen Kohl, Herb [WI] (introduced 6/28/2011)      Cosponsors (1)
Committees: Senate Finance
Latest Major Action: 6/28/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

2. [112nd] S.1289 : A bill to amend the Internal Revenue Code of 1986 to reduce the tax gap, and for other purposes.
Sponsor: Sen Carper, Thomas R. [DE] (introduced 6/28/2011)      Cosponsors (1)
Committees: Senate Finance
Latest Major Action: 6/28/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

3. [112nd] S.1291 : A bill to amend the Internal Revenue Code of 1986 to provide a renewable electricity integration credit for a utility that purchases or produces renewable power.
Sponsor: Sen Klobuchar, Amy [MN] (introduced 6/28/2011)      Cosponsors (1)
Committees: Senate Finance
Latest Major Action: 6/28/2011 Referred to Senate committee. Status: Read twice and referred to the Committee on Finance.

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE:
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

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