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White House: Balanced approach to fiscal woes includes tax rates

White House: Balanced approach to fiscal woes includes tax rates

The White House on Monday threw cold water on the proposal of solving the problem of the so-called "fiscal cliff" by limiting tax deductions and loopholes, instead of allowing taxes to rise for the highest earners in the United States.

"The reality is closing loopholes and ending deductions as an alternative to raising rates on the top earners, the top 2 percent … sounds good, but you have to look at the context of the actual proposals," White House Spokesman Jay Carney told reporters at a briefing.

"It's not necessarily realistic to assume that they can achieve the kind of revenue target that's necessary for a balanced approach, or solution, to these problems."

In an editorial published in the Washington Post this week, Senator Bob Corker suggested an alternative to allowing taxes to rise in 2013 on high earners: capping federal tax deductions at $50,000 without raising tax rates.

Carney said that President Barack Obama supports limiting some deductions and loopholes and also reforming some entitlement programs.

Obama and leaders in Congress are currently negotiating how to avoid the dual problem of taxes going up just as automatic spending cuts kick in next year, which some say will push the country off a fiscal cliff and into a depression.

© Copyright 2012 Thomson Reuters. 

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