Obama 2014 Tax Plan: How Your Taxes Will Likely Increase Under His Plan


The elections are over, but the campaigning never stops. Not long after Americans confirmed the status quo on November 6, Obama and House Republicans are at it again in a battle over who gets to determine the course of American fiscal policy. Republicans are undoubtedly feeling the pressure. Sen. Saxby Chambliss (D/R-Ga.) has already signalled his willingness to bend, and Rep. Tom Cole (R-Okla.) said "I think we ought to take the 98% deal right now." All the fighting is over one component of a tax plan that really isn't much more than that one component. Obama wants wealthy individuals to pay more in taxes.

He has been clear from the front, to his credit. Obama wishes for any individual making more than $200,000, and any family making more than $250,000, to pay more taxes. He proposes doing this by allowing the Bush tax cuts to expire and automatically kicking up rates to Clinton-era levels.  

Obama wrongly claims that he can bring the budget to sustainable levels without raising taxes whatsoever on folks who aren't "millionaires" and "billionaires." This pre-election game from the Washington Post points out clearly how difficult that would be. While of course the game isn't comprehensive, it clearly shows how any "tax reform" in the form of increase revenue will ultimately hit the middle class right in the pockets.  To raise the revenue he needs to avoid making meaningful entitlement reform, Obama will have to eliminate provisions of the tax code that help the middle class most.

Furthermore, as Rep. Tom Price (R-Ga.) points out, the CBO predicts letting the cuts expire for the top 2% of income earners will only collect $82.3 billion a year, funding government operations for only right more days. Price is correct to criticize an "administration that seems to be more interested in raising tax rates than in gaining economic vitality."

The fact is that Obama's "plan" isn't much of a plan at all.  Admittedly, Republicans should be doing more to go on the offensive right now. Constantly through the campaign, Obama criticized Romney's unwillingness to accept $1 in revenue increases for $10 in spending cuts. Republicans should call him out on that. Provide a plan that offers just that very formula to get our federal government back to a balanced budget. Likely, we'll hear rhetoric from the president and an ample amount of spin, but not much else.