In a televised interview on Sunday, President Obama said that he could foresee a budget deal in Congress that did not include further increases in tax rates, but instead focused on eliminating loopholes and deductions.
Generally, President Obama insisted that all revenue options, including higher rates, should be considered to slow the rise of federal budget deficits. However, in this interview, he said, “I don’t think the issue right now is raising rates.”
Having just raised rates on people earning more than $450,000 a year, Mr. Obama said the focus now should be on targeted spending cuts and changes to the tax code, which he said favored the wealthy.
Republicans, having acquiesced to the tax increase in the year-end budget deal, are now insisting that further deficit reduction must come through spending cuts.
Budget experts say that to raise substantial revenue through loopholes and deductions, lawmakers would have to focus on deductions on mortgage interest payments and charitable donations.
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