"Taxmageddon," the end-of-the-year date when the Bush-era tax cuts are due to expire, is looming, putting taxes and the wealthy on a collision course in the presidential election campaign.
Earlier this week, President Barack Obama called for an end to tax cuts only for the wealthiest Americans. His proposal to let the Bush-era tax cuts expire for incomes higher than $250,000 per year is not a new one, but thanks to the election in a scant four months, it's hotter than ever.
"The fate of the tax cut for the wealthiest Americans will be decided by the outcome of the next election," he announced in a White House speech this week. "My opponent will fight to keep them in place; I will fight to end them."
Obama wants to continue the cuts for incomes up to $250,000 for another year. At stake are the economy and job growth: Obama claims that tax hikes on only the wealthiest Americans will improve the economy and help create jobs while Republicans counter that small business owners who pay taxes through personal returns will be hurt.
How will the very wealthiest Americans respond if their taxes are raised? They could take a drastic step and decide they no longer want to be Americans, as an increasing number are doing. This week Denise Rich, ex-wife of pardoned billionaire commodities trader Marc Rich, renounced her U.S. citizenship. She already has Austrian citizenship through her father. Tax lawyers estimate she will save tens of millions of dollars in U.S. taxes. Rich joins close to 1,800 others who turned in their U.S. passports last year, including Facebook co-founder Eduardo Saverin, who became a resident of Singapore. The government says that's a record number since they began keeping track in 1998.
Do you think increasing taxes on incomes more than $250,000 will help spur the economy?
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