A tax policy expert says President Obama's economic advisers should be coming up with ways to cut spending and let the economy heal itself instead of refusing to guarantee they won't raise taxes on middle-class Americans.
President Obama's treasury secretary Tim Geithner and chief economic adviser Larry Summers both said they would not rule out raising taxes on middle-class Americans to trim the budget deficit and pay for the President's healthcare reform plan. President Obama and congressional Democrats have proposed a multitude of tax increases to pay for their economic stimulus package, cap-and-trade program, and trillion-dollar healthcare package. Curtis Dubay, a senior tax policy analyst at The Heritage Foundation, says although the tax increases that get the most attention are those on the incomes of rich Americans, middle-income Americans are also in the crosshairs. "We've heard taxes proposed on sugary drinks and alcoholic drinks. Of course, middle-class people purchase those items. Let's not forget that the cap-and-trade program pushed heavily by President Obama falls on anyone who uses electricity, so that obviously hits the middle-class as well," he points out. "And one of the first actions that President Obama took as President was to increase the cigarette tax by a dollar a pack. And of course, middle- and low-income people are hit heavily by that tax as well." Dubay predicts the Obama administration will not resort to an income tax hike in the near future, but instead will likely use something akin to a national sales tax -- a value added tax -- to boost revenue.
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