(Reuters) – Republicans blasted President Barack Obama on Monday for punishing small businesses with his push to let low tax rates on the wealthy expire, but the truth is more complicated.
In a preview of an end-of-the-year fight over taxes, the parties are squabbling over the impact on “small business” if Obama gets his way and taxpayers earning $250,000 or more lose tax breaks that expire in December.
“Nobody can agree what a small business is,” said Will McBride, an economist at the conservative-leaning Tax Foundation, which backs lower taxes for all business.
Facing a tight re-election fight, Obama is pushing Congress to extend for one year most tax cuts enacted in 2001 under Republican President George W. Bush. Those lower rates expire in December.
House Republicans are planning to pass a measure this month to extend all the Bush-era tax cuts, including for the wealthiest.
Obama, stressing tax fairness, said richer taxpayers can afford to pay more taxes, especially at a time of annual deficits topping $1 trillion.
“I might feel differently if we were still in (budget) surplus,” Obama said during an announcement at the White House on Monday. “But we’ve got this huge deficit, and everybody agrees that we need to do something about these deficits and these debts.”
Nearly every Republican lawmaker who blasted Obama’s pitch used the term “small business” to brand
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