President Agreement by dwc17962

VIEWS: 1 PAGES: 1

More Info
									President Announces Tentative Tax-Cut
Agreement, (Dec. 7, 2010)
President Obama on December 6 announced the framework for a bipartisan agreement that
includes a two-year extension of the 2001 and 2003 tax cuts and a one-year, 2-percent reduction
in payroll taxes for employees in lieu of the Making Work Pay Tax Credit. The tentative deal
also provides an alternative minimum tax (AMT) patch retroactively for 2010 and extends it
through 2011, estate tax relief for two years and a 100-percent write-off for business investments
in 2011.

"Without a willingness to give on both sides, there is no reason to believe this stalemate won’t
continue well into next year," Obama said. The president, in making the announcement, stressed
he would not agree to any extension of high-income tax cuts without an agreement to extend
unemployment benefits in the hardest-hit states and "additional tax cuts for working families and
small businesses."

The president noted that the estate tax compromise is "more generous" than he preferred since it
would raise the personal exemption to $5 million and lower the tax rate from 45 percent to 35
percent on estates exceeding the higher threshold. The proposal also would extend for two years
several expiring tax provisions, including the Child Tax Credit, the American Opportunity Tax
Credit and the Earned Income Tax Credit, according to senior administration officials. The
agreement does not include repeal of the expanded Form 1099 paperwork requirements, a senior
administration official confirmed at a press briefing.

Because the tax-cut compromise would expire in two years, a senior official said the
administration expects any further extension to be "a centerpiece" of the 2012 presidential
debate. In the interim, Obama said he is "not willing to let working families across this county
become collateral damage for political warfare here in Washington and…to let our economy slip
backwards just as we are pulling ourselves out of this devastating recession."

Senate Minority Leader Mitch McConnell, R-Ky., expressed guarded optimism over the terms of
the agreement announced by the White House. "Members of the Senate and House will review
this bipartisan agreement, but I am cautiously optimistic that Democrats in Congress will show
the same openness to preventing tax hikes the administration has already shown," he said in a
prepared statement.

The office of Senate Majority Leader Harry Reid, D-Nev., however, withheld comment until
members of the Democratic caucus review the agreement. A spokesman for Reid released a
statement saying only that Reid will discuss the provisions with Democrats on December 7.
"Now that the president has outlined his proposal, Senator Reid plans on discussing it with his
caucus tomorrow," stated the spokesperson.

								
To top