- (Photo: Reuters)
After House Speaker John Boehner proposed Friday that tax cuts should be extended until next year to provide more time to work out a bigger deal to avert the "fiscal cliff," President Barack Obama said a tax hike for the rich must be part of negotiations.
In his first formal appearance since his re-election, Obama said Tuesday's results were an endorsement of his approach to avoiding steep tax hikes and spending cuts due in January, Reuters reported. A White House spokesperson later said the president would veto any deal that excludes an extra contribution from the wealthiest.
In his speech at the White House on Friday, Obama said tax cuts for the rich could be part of broader negotiations to reduce long-term deficits, but a tax hike for the wealthy should be allowed at the end of the year. "This was a central question during the election. It was debated over and over again, and on Tuesday night we found that a majority of Americans agreed with my approach," he said.
Obama's insistence indicates that he remains at odds with Boehner over the issue even as Congress is likely to take it up when it reconvenes next week.
Hours before Obama's speech, the Republican speaker had called for the extension of all of the Bush-era tax cuts until next year so that there is sufficient time to negotiate on taxes and spending cuts. "I'm proposing that we avert the fiscal cliff together in a manner that ensures that 2013 is finally the year that our government comes to grips with the major problems that are facing us," he said at a news conference on Friday.
"Earlier this week, the president and I had a short conversation. It was cordial. I think we both understand that trying to find a way to avert the fiscal cliff is important for our country, and I'm hopeful that productive conversations can begin soon so that we can forge an agreement that can pass the Congress," he added.
However, Boehner hinted that the House would not agree to increasing tax rates. "We both understand that trying to find a way to avert the fiscal cliff is important to our country," he said, warning that increasing tax rates for the rich could mean slowing down of job creation.
The speaker went on to suggest that tax revenues could be generated from an overall tax-code overhaul involving rate reductions. "It's clear that there are a lot of special-interest loopholes in the tax code, both corporate and personal. There are all kinds of deductions, some which make sense, some don't."
Stan Collender, a former congressional budget aide, was quoted as saying that despite the speaker and the president using softer tones, the disagreement remains, "and it doesn't look like there's been any movement from the last time they had a budget discussion."