US PRESIDENT Barack Obama’s plans for new taxes on the wealthy and on Wall Street banks were met with fierce criticism from the Republicans yesterday, signalling the challenges facing any attempt to shake-up the US tax code.
Obama will use his State of the Union address tomorrow to propose a raft of new measures aimed at raising more than $300bn and helping to fund more middle class-friendly tax credits.
His plan includes raising the top tax on capital gains to 28 per cent from 23.8 per cent and closing a loophole that lets the heirs of large estates avoid paying the full capital gains tax on assets they inherit.
Obama also plans to impose a new fee on the on the liabilities of the US’s largest financial firms. Those institutions would have to each have over $50bn in assets.
With Congress deeply divided on fiscal policy, Obama’s plan is likely to hit strong opposition, with Republican representative Jason Chaffetz calling it “a non-starter.”
"Are you going to actually grow the economy and jobs, are entrepreneurs going to be better off, are small businessmen going to be better off, with more taxes and more government? No!” he told CNN’s State of the Union show.