US President Barack Obama is increasingly turning to financiers and the firms that employ them as a source of revenue to plug holes in his budget and what he sees as gaps in the tax code itself, media reports say.
US President Barack Obama is increasingly turning to financiers and the firms that employ them as a source of revenue to plug holes in his budget and what he sees as gaps in the tax code itself, media reports say.
Mr Obama yesterday announced $58 billion in new proposals that his aides said would close “unfair loopholes” in the tax system. The changes would mean higher taxes for options and commodities brokers, hedge fund managers, and life insurers such as TIAA-CREF. The tax increases will help pay for Mr Obama’s health care reforms.
The US administration, which is facing massive budget deficits, hopes to raise revenues by closing tax loopholes; it has already stepped up rhetoric against so-called tax havens and has been embroiled in a legal wrangle with jurisdictions such as Switzerland over offshore bank accounts.
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Those proposals and others would nearly triple income taxes paid by executives at private equity firms and cap the value of itemised deductions. As part of the changes, high-income earners would be unable to avoid top marginal rates when they are reinstated in 2011 to 36 per cent and 39.6 per cent for US citizens making more than $200,000 annually, analysts said.
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