Author Topic: Obama's State of the Union will promise tax rate cuts to corporate giants but leave small businesses out in the cold – while increasing government's overall take  (Read 456 times)

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Offline Rapunzel

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http://www.dailymail.co.uk/news/article-2547031/Obamas-State-Union-promise-tax-rate-cuts-corporate-giants-leave-small-businesses-cold-increasing-governments-overall-take.html

Obama's State of the Union will promise tax rate cuts to corporate giants but leave small businesses out in the cold – while increasing government's overall take

    Watchdog warns: Obama will head-fake by offering tax cuts to big businesses while closing loopholes on every company in America

    The result, says Americans for Tax Reform, will be a bigger income for the government and no relief for small businesses

    President Obama will deliver his annual State of the Union address on Tuesday night, and is expected to push 'income inequality' policies

    Congressional Democrats need a defining issue while Obamacare recovers

    Explaining away an apparent big-business tax cut will be hard for them, even if it's not a real tax cut at all'

    GOP campaign operative speculates: 'Obama is going to have to go back to his people and whisper, "Don't worry about that corporate tax cut – I don't really mean it"'

By David Martosko, U.s. Political Editor

PUBLISHED: 18:05 EST, 27 January 2014 | UPDATED: 18:23 EST, 27 January 2014


President Obama is expected to outline a seismic shift during Tuesday's annual State of the Union address in how much tax American businesses pay, but the devil is in the details.

While his plan will lower the top corporate rate, smaller companies whose proceeds are considered individual income – since they're not organized as large corporations – won't see any benefit.

And the net impact, says one Washington, D.C. watchdog group, will be more money, not less, flowing into the federal government's coffers. Those funds, the group says, will be redistributed into public works projects calculated to benefit labor unions that support Obama and other Democrats.

Obama hinted at a corporate tax overhaul proposal in his 2013 State of the Union speech, never bringing anything forward until 2014 when a congressional election looms large

Corporate giants like Google would pay more taxes under Obama's plan when it kills deductions and closes loopholes, but the big companies would get a rate reduction in exchange -- unlike smaller businesses

Manufacturers love infrastructure projects near their factories, a fact Obama is hoping to leverage in order to get the GOP to go along with his plan: some of the new tax revenue would reportedly pay union-backed construction projects across America

'The President’s plan is a net tax increase,' the right-leaning anti-tax group Americans for Tax Reform said Monday. 'The plan raises taxes on all American employers, but only gives partial rate relief to the largest multi-national companies.'

Obama will reportedly dust off a proposal Tuesday night from his 2012 campaign, when he argued for lowering the top corporate tax rate from 39.1 per cent to 28 per cent in exchange for closing a series of tax loopholes and disallowing a wide range of business tax deductions.

Those give-backs Obama would affect all businesses, both small and large, while only the largest corporations would see a reduction in their overall rates.

The average top corporate tax rate among member nations in the Organization for Economic Co-operation and Development is 25 per cent, according to the nonprofit Tax Foundation. America's top rate is the highest.

IRS data show that 32 million businesses file tax returns every year, and fewer than 2 million of them are corporations that can tax advantage of tax rates and loopholes extended to General Motors, Apple Computer, ExxonMobil and other Wall Street titans.

The Wall Street Journal reported Saturday that a source who received a private White House briefing advised the paper to 'expect to hear Mr. Obama trumpet a proposal he made last year: reworking the business-tax system and directing proceeds to roads, bridges and other public works projects.'

ATR sees those initiatives as Democrat-aligned union construction projects.

Grover Norquist, the group's president, was aghast.



Oh, poop: Dog-walkers and other small businessmen and women will continue to pay individual income tax rates on everything they earn, but they'll have to give up the same deductions the big boys are slated to lose




Run your own consultancy from your kitchen table? You're out of luck, too -- stuck with a 44 per cent effective tax rate

Playing coy: A milquetoasty White House press secretary Jay Carney will say only that Obama will address 'the need to grow our economy in a way that rewards hard work and responsibility, that makes the middle class more secure'

That kiss Obama blew to his wife before delivering last year's State of the Union address might be redirected this year to congressional Democrats who need political cover to push his 'income inequality' philosophy on the campaign trail

'Again?' he asked when MailOnline contacted him in Washington. 'Obama is spraying perfume on and recycling two ideas that have already failed.'

'One, "tax reform" – by which he means higher overall taxes on businesses targeting entrepreneurs and the self-employed – and two, taking all that tax revenue and having another stimulus spending spree.'

'It failed the last time,' said an exasperated Norquist. 'How stupid does he think we are?'

In his 2013 address, Obama promised several initiatives that never managed to arrive later in the year amid scandals that included Obamacare's sputtering start, an alleged Benghazi cover-up, The National Security Agency's data collection programs, the IRS's targeting of tea party groups and the Justice Department's spying on journalists.

Quote
Harping a year ago on the so-called 'Buffett rule,' Obama told Congress that Americans deserved a 'tax code that ensures billionaires with high-powered accountants can’t work the system and pay a lower rate than their hardworking secretaries ... and lowers tax rates for businesses and manufacturers that are creating jobs right here in the United States of America.'


A year later, the White House is gearing up to take some action. But ATR warned Monday that the net result would be a higher tax bill overall.

'The Republican House would never support a net tax increase, and using the money to fund Big Labor (and, by extension, Democrat campaign coffers) is hardly a sweetener,' the group said in a statement.

Obama is emboldened by the populist appeal of his 'income inequality' argument, a Democratic Party insider told MailOnline. And he hopes to soften Republicans for a minimum-wage hike by offering big business a carrot instead of a stick.

'The president is now preparing speeches on income inequality,' said RNC chair Reince Priebus, but 'I believe he should give those speeches while standing in front of the mirror, because under his watch, everything has gotten worse'

But the result may be a triple-whammy on employers if they find themselves squeezed simultaneously by a higher tax bill, higher wage costs and higher health care expenses.

Quote
Still, congressional Democrats desperately need a defining issue to run on in the November midterm elections, and the White House believes a rich-vs-poor argument can win the day with its base.


And anything that sniffs of a tax cut for the rich, suggests Democratic Rep. Steve Israel, won't play well with liberal voters. Israel chairs the Democratic Party's congressional campaign organization.

'Middle-class security is the defining issue of our time,' Israel told the Associated Press. 'Our candidates are going to talk about what priority makes more sense for the middle class: Increasing the minimum wage, or decreasing taxes for the wealthiest? Those contrasts are imperative and revealing.'

The danger for Democrats is that the current state of play for lower-income Americans has followed five years of Obama's presidency.

Republican National Committee Chairman Reince Priebus told a partisan crowd last week that Obama was trying to fix a problem that he caused himself.

'His economic policies are not working,' Texas Republican Sen. Ted Cruz added Sunday on the CBS program 'Face The Nation.'


Yes, you too: most U.S. farmers are sole proprietors of their businesses, making them ineligible for what may appear to be a massive Obama tax rate cut

While many small U.S. businesses cope without any tax relief, Facebook founder Mark Zuckerberg will find his company's earnings taxed at a lower rate under Obama's expected proposal

After-tax U.S. corporate profits are at a level not seen since the years following World War II. And it has been 60 years since ordinary workers saw a smaller share of the nation's economic output than they did in 2013.

The campaign manager for a Republican House candidate in New York, Israel's home state, told MailOnline on background that Obama's foray into tax policy could blow up in his face.
Quote

'The president needs more Democrats in Congress, and he's not going to get there by offering what looks like a tax cut for Wall Street,' the political operative said, 'even if the result is shareholders getting smaller dividends and CEOs losing some of their bonuses.'


'It's the perception that counts in November, and it sounds like Obama is going to have to go back to his people and whisper, "Don't worry about that corporate tax cut – I don't really mean it."'

The White House has been mum on the content of Obama's speech. Jay Carney, his press secretary, told Reporters on Friday only that the president would address 'the need to grow our economy in a way that rewards hard work and responsibility, that makes the middle class more secure.'
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Rapunzel

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More croney tax rates....... and this man has the audacity to preach income in-equality.
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline happyg

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If he goes to far with talking about what he will do for the poor and middle class, it will look bad for him. He's been doing that since day one, and people don't believe him, anymore.

Offline Rapunzel

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If he goes to far with talking about what he will do for the poor and middle class, it will look bad for him. He's been doing that since day one, and people don't believe him, anymore.

He has increased income in-equality since he's been president - which I believe was his goal all along...   If the GOP was smart (they aren't) they would get with the middle class and play to the middle class voters in November... not pander though, I'm sick of pandering.
“The time is now near at hand which must probably determine, whether Americans are to be, Freemen, or Slaves.” G Washington July 2, 1776

Offline Oceander

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Tax avoidance is become a patriotic duty - and about the only way most small businesses are going to survive for the next few years.

Here are a couple of hints:  (a) don't create fictions that can be easily double-checked, (b) if you file sales tax returns, make sure that your income tax returns are consistent with your sales tax returns, (c) a paper record is everything in a tax audit, but it has to be a record that was made contemporaneously and in a way that you regularly keep records of that sort; whatever you do, don't try at the end of the year to go back and "recreate" the necessary paper records for the business-related expenses you're claiming, and (d) pick a story early, make sure it's consistent, and stick with it.
« Last Edit: January 27, 2014, 11:49:10 PM by Oceander »

Online rangerrebew

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I don't believe he has any intention of lowering taxes on anyone; it wouldn't play well with his plan to destroy America and he is definitely no going to anything that would delay his goal.  This is nothing but trash talking.  He knows it will never get through the democratic party since they are dead set against tax breaks for any reason other than themselves.  It's a talking point while he tries to schmooze the public back into thinking he is the messiah.  When the congress shuts down the proposal he will look like the champion against those evil people in Washington who don't want to get more money from the rich.  It's a tactic he has used for 5 years.
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It's all about helping out his union buddies.
Quote
Obama to raise federal minimum wage
By Associated Press
January 28, 2014 | 6:51am


WASHINGTON – Newly repackaged, President Barack Obama’s State of the Union address will deliver familiar content along with some targeted first-time initiatives that both test and illustrate the limits of divided government in an election year.

His message to a joint session of Congress on Tuesday will identify measures where he and Congress can cooperate, and he will press issues that will distinguish him and Democrats from Republicans. He’ll also make a case for acting alone.

Illustrating his willingness to act on his own, the White House says Obama will announce that he will sign an executive order increasing the minimum wage from $7.25 to $10.10 for new federal contracts. The measure affects only future contracts, not existing ones, and would only apply to contract renewals if other terms of the agreement changed. As a result, the order would benefit far fewer workers than the number foreseen by advocates of federal contract employees.

Still, the issue dovetails with what will be Obama’s broader call for an increase in the national minimum wage to $10.10 and for future increases to be tied to inflation. Obama last year had called for an increase in the minimum wage to $9.

The address will be wrapped in a unifying theme: The federal government can play a key role in increasing opportunities for Americans who have been left behind, unable to benefit from a recovering economy. Yet, at the core of the address, the president will deliver a split message.

Even as he argues that low income Americans and many in the middle class lack the means to achieve upward mobility, Obama will also feel compelled to take credit for an economy that by many indicators is gaining strength under his watch. As a result, he will talk positively about a recovery that remains elusive to many Americans.

Some Democrats are warning Obama to tread carefully.

“We hope that he does not dwell on the successes of the economy, which may be apparent in employment statistics, the GDP and stock market gains, but which are not felt by folks at the grocery store,” Democratic political analysts James Carville and Stan Greenberg wrote in a recent strategy memo.

The president will present Congress with an agenda largely unchanged from what he called for a year ago, but one that nevertheless fits neatly into this year’s economic opportunity theme. He will continue to seek an overhaul of immigration laws, an increase in the minimum wage and expanded pre-school education.

But after a year in which those proposals languished and gun control failed, the White House is eager to avoid letting Obama be defined by quixotic ambitions. As a result, he will stress success through executive actions, though their reach would be far more modest than what he could achieve through legislation.

“You can be sure that the president fully intends to use his executive authority, to use the unique powers of the office to make progress on economic opportunity to make progress in the areas that he believes are so important to further economic growth and further job creation,” White House spokesman Jay Carney said Monday.

Obama’s biggest and most lasting accomplishment of his second term could be immigration legislation. House Republican leaders lately have sent signals that they are willing to act on piecemeal legislation, and Obama has given them room to work without prodding.

How immigration gets resolved will depend much on what the House is able to pass and if and how it can be reconciled with bipartisan Senate legislation that passed last year. Conservatives are pushing back against any bill that gives legal status to immigrants who are in the country illegally. And some Democrats would prefer to use the unresolved issue to mobilize Hispanic voters for this year’s midterm elections.

Eager not to be limited by legislative gridlock, Obama on Tuesday is expected to announce executive actions on job training, retirement security and help for the long-term unemployed in finding work — all in addition to his order to increase the minimum wage on new federal contracts.

Among them is a new retirement savings plan geared toward workers whose employers don’t currently offer such plans. The program would allow first-time savers to start building up savings in Treasury bonds that eventually could be converted into a traditional IRAs, according to two people who have discussed the proposal with the administration. Those people weren’t authorized to discuss it ahead of the announcement and insisted on anonymity.

“Tomorrow night, it’s time to restore opportunity for all,” Obama said Monday on the video-sharing site Vine, part of the White House’s broad social media promotion of the speech.

The White House says the hike in minimum pay for federal contract workers would most benefit janitors and construction workers working under new federal contracts, as well as military base workers who wash dishes, serve food and do laundry. The White House says contractors will have time to take the higher minimum wage into account when pricing their bids.

Obama’s go-it-alone approach has already irritated Republicans, some of whom claim he is pushing the limits of the Constitution; others diminish his initiatives as insubstantial.

“He can work with us to create opportunity and prosperity,” wrote Brendan Buck, a spokesman for House Speaker John Boehner, R-Ohio. “Or he can issue press releases.”

The approach, some Republicans say, could also backfire by angering GOP leaders who already don’t trust Obama’s administration.

“The more he tries to do it alone and do confrontation, the less he’s going to be able to get cooperation,” said John Feehery, a former top House Republican aide.

Obama will follow his State of the Union address with a quick trip Wednesday and Thursday to Maryland, Pennsylvania, Wisconsin and Tennessee to promote his proposals. On Friday, Obama will hold an event at the White House where he’ll announce commitments from several companies to not discriminate against the long-term unemployed during hiring.

Following tradition, the White House has invited several people to sit with first lady Michelle Obama during Tuesday night’s address. Among them are General Motors CEO Mary Barra and Cristian Avila of Phoenix, an immigrant who with two younger siblings was brought to the U.S. illegally when Avila was 9. Now 23, Avila is one of the so-called Dreamers who have benefited from an Obama policy allowing young people who immigrated illegally with their parents to avoid deportation.
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Offline Gazoo

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It's all about helping out his union buddies.


Yep.

Obama Raising Minimum Wage for Federal Contractors by Executive Order
http://www.newsmax.com/Newsfront/obama-lifts-minimum-wage/2014/01/28/id/549361

PRAY his teleprompter breaks tonight and Obama is seen to be the radical lying POS he is.
"The Tea Party has a right to feel cheated.

When does the Republican Party, put in the majority by the Tea Party, plan to honor its commitment to halt the growth of the Federal monolith and bring the budget back into balance"?

Offline Gazoo

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If he goes to far with talking about what he will do for the poor and middle class, it will look bad for him. He's been doing that since day one, and people don't believe him, anymore.

Or only real HOPE is his teleprompter breaks down and he melts down.

Although our media would still cover for him. Remember his speech after getting a shellacking years ago? He spoke like he was on lithium.
"The Tea Party has a right to feel cheated.

When does the Republican Party, put in the majority by the Tea Party, plan to honor its commitment to halt the growth of the Federal monolith and bring the budget back into balance"?


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