News24

Obama warns taxes on rich must rise

2012-11-09 22:30

Washington - US President Barack Obama on Friday claimed a mandate to raise taxes on the rich to pay for deficit reductions, firing his first post-election shot in a year-end budget showdown with Republicans.

"We can't just cut our way to prosperity. If we are serious about reducing the deficit, we have to combine spending cuts with revenue, and that means asking the wealthiest Americans to pay a little more in taxes," he said.

The president also announced in a punchy, televised White House statement, his first public appearance since his election night address, that he would call top Republican and Democratic leaders to the White House next week.

The talks will focus on averting the so-called "fiscal cliff" - a catastrophic blend of automatic tax rises and harsh spending cuts due to come into force on 1 January, which could cause a new recession.

Obama signaled a willingness to compromise on the details of a deficit reduction plan, but he made clear that his bottom line principle involved rejecting the Republicans' flat refusal to raise any taxes.

"This was a central question during the election, it was debated over and over again. On Tuesday night, we found that the majority of Americans agree with my approach."

"I want to be clear. I'm not wedded to every detail of my plan. I'm open to compromise. I'm open to new ideas. I refuse to accept any approach that isn't balanced.

"I'm not going to ask students and seniors and middle class families to pay down the entire deficit while people like me making over $250 000 aren't asked to pay a dime more in taxes. I'm not going to do that."

Obama's approach left room for negotiation with Republicans and could possibly permit a compromise that keeps income tax rates the same for the rich, but involves a removal of deductions on investment income.

Comments
  • ali.asgar.58323 - 2012-11-09 22:53

    At least he gets one thing right!

      raj.morar.1 - 2012-11-10 11:05

      One thing????? Have you just woken up from cuckoo land?

      TheMoMeister - 2012-11-10 11:17

      Do you live in some sort of yogurt commercial? You can't multiply by dividing.

  • dean.elliman - 2012-11-09 23:51

    What so good about that? It means not just individuals who earn $250k or more , but also small businesses that earn more than $250k a year will also have to pay more taxes. These small businesses are already struglling so will have to lay off more workers to keep their doors open, which means more unemployment and less people paying regular income tax and thus increasing the deficit that they originally are trying to close the gap!!!!

      michael.i.wright - 2012-11-10 00:14

      The effect started kicking in immediately. Two guys I know from the Midwest have already terminated some staff as of today.

      Tom - 2012-11-10 02:10

      Well said Dean. US has highest corporate tax rate in world and dumb liberals just want to tax more so they can add more people onto food stamps, and once totally dependent they will keep voting for them and supporting their socialist vision of America.

      raj.morar.1 - 2012-11-10 11:07

      Read his comments for the past year. NO raised taxes for small business

      raymond.dick.12 - 2012-11-10 13:20

      You really should understand the proposal BEFORE you make any comment. The so-called small business are those that make a PBIT of $250k. That is quite a good profit of which they have to part with only a relatively small amount extra to their current tax burden.

  • whatda.fuqbro - 2012-11-10 01:40

    In principle, I'm all for increasing taxes for the wealthy. The thing is it's a double-edged sword since it can give more incentive to invest in tax havens or find tax loopholes to exploit. Rich folk can do wonders for the economy so you don't want to scare them away. It's not as simple as just increasing the tax rate - there are other issues to take into consideration here.

      raymond.dick.12 - 2012-11-10 13:25

      That may be true; but there are also incentives proposed to provide tax incentives to those who invest in the local economy. The other side of the "sword" is that if the middle class do not have money to spend the rich will get poorer. In this case, by the rich paying more, they will in fact be investing in their own wealth creation.

  • theMichaelHawthorne - 2012-11-10 04:09

    That's what happens when you let Osama lead a country...

      blip.noodlum - 2012-11-10 05:56

      Or Buma. Or Angela Terkel.

  • bbooyse - 2012-11-10 07:10

    Completely pointless - the richest americans are the business owners, increasing their taxes will just prompt them to downsize staff and\\or pass this increase down to their prices\\tariff.

      raymond.dick.12 - 2012-11-10 13:28

      Only if they are stupid, short sighted, overly greedy or any combination of these.

  • David Steyn - 2012-11-10 07:11

    Dean don't be to harsh on Hendrik. It is not his fault that he was born without a brain.

  • dylan.sciarappa - 2012-11-10 07:33

    Oh pls Obama is proven to be a stone cold liar. He says one thing and does the complete opposite. So he will increase the wealthiests taxes but on the side he will introduce additional tax breaks and subsidies for the multi national corporations. Obama works for the 1%. Who do you think pays for his election campaigns?

  • christo.visser.7 - 2012-11-10 07:44

    one would not need to raise taxes on the rich if neoliberal macroeconomic policies that only benefit the rich were put aside in favour of more pro-poor policies directed at helping the poor.I am not a socialist or a communist by any means and i do believe that the free market can be beneficial to everyone, but then one needs to level the playing field so that everyone can have a slice of the cake. If neoliberal thought and policy were not to be reworked then alternatives must be sought even if this means raising taxes on the rich. Those who have cannot have it all their own way.

  • dane.herbst.5 - 2012-11-10 08:59

    biggest liar ever, he is a sell out, owned by wall street

  • erns.kleynhans.3 - 2012-11-10 09:40

    Sorry, but it will not work. Reason being that if the rich become the only support for the poor, the poor will only become poorer in their descent to a life of sitting back waiting for freebies. It's like the dead sea, only receiving, but no giving back in return. It creates poor societies... but I know a very few people will actually understand this as it is the law of nature.

  • gerrit.vanpletzen - 2012-11-10 11:12

    He should have done it a long long time ago. The super rich get away with paying taxes all the time, getting tax deductions on so many things the poor salaried people can just not dodge.

  • jean.rossouwsa - 2012-11-10 11:17

    He sells his reforms to the 99% paid by the 1%! (students an your people)How stupid can you be to vote for a man who ask you to vote for him but then he leaves you with trillions of $$ in debt, debt that you cannot repay and most likely would also be your children's problem. Suggest that all who support this man to put a big O sticker on their cars so that we know who to blame if USA economy fails just like Europe.

  • charlesmakgale.radingoane - 2012-11-10 18:42

    Well done Obama

  • eduard.louw - 2012-11-10 19:30

    The rich can afford to leave.

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