Conservatives' Tax Strategy: Use Economic Fears to Cut Taxes for the Wealthy

Congressional conservatives have revealed their negotiating strategy for dealing with the fiscal cliff slope: scare the public and congressional Democrats into a deal that reduces the deficit through spending cuts alone. These fears have been blown out of proportion. A fiscal Armageddon will not happen on Jan. 1, 2013.

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Passing Over the "Fiscal Cliff" in Early 2013 Seems Increasingly Likely

While the outcome of the 2012 election will still ultimately decide next steps on the federal budget, a status-quo election that leaves Democrats in control of the presidency and Republicans in control of the House of Representatives seems likely to produce a budget stalemate that will last through the rest of the year and will trigger a "fiscal cliff" of spending cuts and tax increases in the new year.

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New OMB Watch Analysis Indicates that Current Low Estate Tax Rates Are Unaffordable, Should Be Rolled Back to Earlier Levels

WASHINGTON, Oct. 2, 2012—In a new analysis published today, OMB Watch makes the case for a strong, effective estate tax. The analysis lays out the importance of the tax in raising federal revenues and the ongoing budget debate and presents options for moving forward on the estate tax as the expiration of the Bush tax cuts looms at the end of the year.

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Tax Treatment of Capital Gains and Stock Trades Receives Attention as Congress Considers Tax Reform

On Sept. 20, the two congressional tax-writing committees held a joint hearing on the tax treatment of capital gains – gains on assets such as stocks, real estate, and other forms of wealth. The combined hearing – which brought together members of the Republican-controlled House Ways and Means Committee with members of the Democratically controlled Senate Finance Committee – demonstrated the commitment of both parties to address tax reform issues soon after the elections. Such reforms may come as part of a larger budget package intended to prevent the federal government from going over a "fiscal cliff" on Jan. 2, when a host of Bush era-tax cuts are set to expire and across-the-board spending cuts required by the 2011 Budget Control Act will go into effect.

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Inheritance Tax Renewal to Be Part of "Fiscal Cliff" Discussions

With the federal budget on the precipice of a "fiscal cliff" of pending budget cuts and tax increases that could take place starting Jan. 2 and tip the economy into recession, many budget watchers are waiting on the outcome of this year's elections to determine how to proceed. One issue up for discussion is the renewal of the inheritance tax (also known as the estate tax).

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Buffett Rule Targets Capital Gains

On April 16, the Senate voted on a bill that would have enshrined the “Buffett Rule” in the tax code, which would have ensured that millionaires and billionaires pay their fair share of taxes. With the bill’s defeat, Congress should consider other options to increase tax fairness.

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Congressional Progressive Caucus and Ryan Revenue Proposals: Two Sides of the Budget Coin

The fiscal year (FY) 2013 budgets proposed by the House Congressional Progressive Caucus (CPC) and Rep. Paul Ryan (R-WI), Chair of the House Budget Committee, are perfect examples of the fact that budgets are about choices. The revenue proposals in each serve as a study of opposites. Where the Ryan budget would double down on the Bush tax cuts and provide huge windfalls to the country’s wealthiest, the CPC’s proposal – The Budget for All – would ask those with the most wealth to help fund important investments in our public structures.

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Cutting Oil and Gas Tax Subsidies a Small but Responsible Step

There are few subsidies more polarizing than those for oil and gas drilling. Increasingly, however, the public tide seems to be turning against the subsidies. The president has been targeting them for repeal, and last week, the Senate came just a few votes shy of ending a slew of tax subsidies for oil and gas companies. While the subsidies are small compared to the forecasted $10.7 trillion 10-year deficit, ending the give-away to oil and gas companies that currently enjoy record-setting profits is a popular and fiscally responsible choice.

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GOP Candidates' Tax Plans Reduce Taxes on Wealthy, Increase Deficits

As the media focuses its attention on the Republican Party’s presidential nominating contest, several tax and budget organizations have taken turns examining the candidates’ tax proposals. In January, Citizens for Tax Justice (CTJ) released a report looking at the costs of each of the GOP contenders’ plans, and, just recently, the Tax Policy Center (TPC) scrutinized the distributional impacts of the candidates’ proposals. Both reports found that all of the contenders’ tax plans would disproportionately benefit the highest-income households and exacerbate budget deficits.

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Report Highlights Need for Additional Revenue Options

The current top federal income tax rate is 35 percent. But what would the top rate have to be in order to raise enough federal revenues to cover spending? A recent paper from the Tax Policy Center (TPC) and the Pew Fiscal Analysis Initiative sets out to answer that question, but its answer is incomplete. To bring federal revenues up from their current historic lows, Congress needs to consider more revenue options than just raising individual income tax rates.

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