Can U.S. economy tolerate a tax increase in 2013?
Is the American economy strong enough to withstand an income tax increase starting on New Year’s Day?
The rhetorical skirmish over this question is the prelude for bargaining that’s likely to culminate after Election Day as President Barack Obama tries to persuade Congress to raise income tax rates on people with incomes over $200,000 and Republicans try to keep the current tax rates in place at least for 2013.
If the two sides don’t come to terms, income tax rates for all earners go up on New Year’s Day.
For a middle-income married couple with three children under age 17, this would mean at least a $1,500 tax increase since the child tax credit is set to shrink at year end from $1,500 per child to $500 per child.
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The tax policy clash played out on NBC’s Meet the Press Sunday as Meet the Press host David Gregory played a clip of Obama saying in 2010 that “the economy remains somewhat fragile” and asked Senate Democratic Whip Dick Durbin, “If it was a bad idea to raise taxes in a down economy then, why is it a good idea to raise taxes in a down economy now?”http://nbcpolitics.msnbc.msn.com/_news/2012/07/15/12753063-can-us-economy-tolerate-a-tax-increase-in-2013?lite