WASHINGTON — President Obama on Monday announced a deal with Republicans to extend Bush-era tax cuts for the wealthiest households, retreating on a campaign promise and infuriating congressional Democrats and liberals across the country.
The president's proposal would extend tax cuts for all income brackets, including those exceeding $250,000, for two years, bowing to a GOP demand. In exchange, Republicans agreed in principle to extend unemployment benefits for 13 months as well as continue tax breaks for middle-class workers, child-care expenses and college costs. The deal also includes a GOP-backed proposal on the estate tax and would reduce each worker's Social Security tax by 2 percent for one year.
Obama made it clear that he disagreed with the extension of tax cuts for the wealthiest earners and other provisions, but said it was more important to settle the issue so middle-class tax payers did not incur a tax increase Jan. 1.
"I have no doubt that everyone will find something in this compromise that they don't like. In fact, there are things in here that I don't like," Obama said. "For now, I believe this bipartisan plan is the right thing to do."
The White House faces the daunting task of winning congressional support for what White House officials billed as a bipartisan compromise.
"The House Democrats have not signed off on any deal," said Maryland Rep. Chris Van Hollen, who participated in formal negotiations on the tax issue. "We will thoroughly review and discuss the proposed package in the caucus."
Other senior Democrats said an agreement by Obama to accede to Republican demands on the estate tax could lead to a revolt.
House Republicans signaled their agreement with the deal, and Senate Republican leader Mitch McConnell said Obama's outline marked a White House acknowledgment that "a new direction is needed if we are to revive the economy and help put millions of Americans back to work."
rest at http://o.seattletimes.nwsource.com/html/nationworld/2013612945_taxes07.html
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