It’s understood that Obama’s budget is a wish list, one that Congress is unlikely to fulfill. Keeping that in mind, it looks like he’s trying to cover his butt on the recent tax cuts. If he thought they were so bad, why didn’t he veto them?
WASHINGTON (MarketWatch) — President Barack Obama’s new budget proposes to end Bush-era tax cuts for the wealthiest Americans, returning to a longstanding pledge while also giving small businesses a number of breaks but rescinding preferences for oil and gas companies.
Sent to Congress on Monday, Obama’s spending and tax blueprint for fiscal 2012 eliminates the 2001 and 2003 tax cuts for families making more than $250,000 annually. Late last year, Obama and congressional Republicans struck a deal to extend those cuts for two years, but Obama has now painted a target on the cuts again.
“These policies were unfair and unaffordable when enacted and remain so today,” Obama said in his budget message. He said he’ll push for them to expire in 2012. Read 2012 budget documents on White House web site.
The budget also seeks to raise about $46 billion by taking away oil and gas companies’ tax deductions and credits, including a credit for oil and gas produced from marginal wells. The energy proposals are repeats of last year’s budget and are staunchly opposed by the oil industry. Obama intends to use the extra revenue to fund clean energy research. Read story about Obama’s 2012 budget proposal.
Obama also wants to end tax breaks on U.S. companies’ overseas income which would reap a total of $129 billion over 10 years. Obama proposed the same thing in last year’s budget. This year’s proposal comes as the White House is working with corporations and lawmakers on proposals to overhaul the corporate tax code — though the budget contains no specific proposals on corporate tax reform.
As part of his overall $3.7 trillion request for 2012, Obama is also proposing a “patch” for the alternative minimum tax that’s paid for by a 30% reduction in itemized deductions for high-income taxpayers. The AMT was originally intended to be levied on wealthy Americans.
Meanwhile, the budget also extends or expands a number of credits for families and individuals, including the earned income tax credit and the child and dependent care tax credit.
In the weeks leading up to the release of the budget, Obama spoke repeatedly about the need to invest in areas like clean energy and high-speed rail, and the budget gives a number of tax cuts to businesses.
Included are an elimination of capital gains taxes on investments in small business stock; making permanent the research and experimentation tax credit; and extra credits for properties used for advanced energy research.
Looks like a lot of “See, folks, I’m really on your side” without any real strategy to back it up.