Robert J. Samuelson: Taxes are certainly going to rise for the wealthy; top marginal rates will near 50 percent
To reduce this, many economists favor limiting tax breaks to keep rates low. Republicans have been more open to this approach, because (they argue) lower rates might mitigate the adverse effects of higher tax burdens on the economy. Individuals would still have incentives to work hard; they'd keep a higher percentage of any increase in earnings. Similarly, small businesses — which often pay taxes at personal income rates — would have incentives to hire.
The TPC estimated that limiting taxpayers' itemized deductions — including mortgage interest payments, charitable contributions, and state and local taxes — to $17,000 could raise $1.7 trillion over a decade. Marron points out, however, that some resulting tax increases would fall on those below Obama's $200,000/$250,000 threshold.
There's plenty left for negotiation.
Robert J. Samuelson is a Washington Post columnist.
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