Speaking in his third State of the Union address, President Obama urged congressional lawmakers to join together in an effort to curtail wasteful government spending and reform the nation’s complex and complicated tax code.
Laying out the groundwork for a plan to increase the tax rate on individuals making more than $1 million, Mr. Obama called on lawmakers to embrace a plan out forth by Oklahoma U.S. Senator Tom Coburn, the latest attempt to put forth a bipartisan plan on the issue.
“Tax reform should follow the Buffett rule: If you make more than $1 million a year, you should not pay less than 30 percent in taxes. And my Republican friend Tom Coburn is right: Washington should stop subsidizing millionaires,” said Mr. Obama. “In fact, if you’re earning a million dollars a year, you shouldn’t get special tax subsidies or deductions. On the other hand, if you make under $250,000 a year, like 98 percent of American families, your taxes shouldn’t go up.”
In a speech that was at time confrontational, Mr. Obama said he supports expending the payroll tax, noting that the nation remains far from economic recovery. Leaders of Congress reached a deal in late 2011, extending the payroll tax for two months, a plan that Mr. Obama expressed disappointment in having to sign into law.
“Right now, our most immediate priority is stopping a tax hike on 160 million working Americans while the recovery is still fragile. People cannot afford losing $40 out of each paycheck this year. There are plenty of ways to get this done. So let’s agree right here, right now: No side issues. No drama. Pass the payroll tax cut without delay,” said Mr. Obama.
