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Xinhua News Agency, Washington, December 19 (Reporter Chen Cong) US President Obama said on the 19th that he would veto the “Plan B” proposed by US House Speaker Boehner to solve the “fiscal cliff”. The plan includes tax increases and spending cuts and is scheduled to be implemented on January 1, 2013.
“This approach is unbalanced and will result in the President vetoing the bill even if it passes,” White House communications director Dan Pfeiffer said in a statement. “The President urges Republican leadership to work with us to resolve the remaining differences and find a reasonable solution to today’s situation.”
Boehner said Tuesday that if his efforts to reach a broader deal with the White House fail, he would turn to “Plan B,” a proposal to avoid the looming fiscal crisis. U.S. House Republicans are set to vote on the bill on Thursday.
The backup plan Boehner proposed Tuesday would extend all Bush-era tax cuts, including lowering individual income tax rates on the first $1 million of income, lowering dividend and capital gains tax rates, while eliminating tax spending limits even for households earning more than $1 million, according to preliminary White House estimates.
The White House said Boehner’s “Plan B” would only raise about $300 billion for the wealthiest class, and millionaires would receive an average tax cut of $50,000.
In his latest proposal, Obama said he was willing to accept a deal that would raise the threshold for raising taxes on households to $400,000 a year from the $250,000 he had initially insisted on.
If the White House and Congress cannot reach a deal, all Bush-era tax rates will expire at the end of this year, and automatic tax increases and spending cuts will kick in. Economists warn that these tax increases and spending cuts could push the U.S. economy into recession.
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