President Obama ran his last campaign on the central premise that, in order to truly achieve economic stability and fully recover from the Great Recession he inherited, we must ensure that everyone plays by the same rules and everyone pays their fair share.
As we start off the New Year, thanks to the steadfast leadership of President Obama, this campaign promise has become reality.
Although Congressional Republicans tried to delay a vote (which would have led to deep cuts in programs that benefit the middle-class, raised taxes significantly for 98% of families and 97% of small businesses, and provided a serious blow to our growing economy) around 11pm on New Year’s, the House finally voted to pass the “American Taxpayer Relief Act of 2012”.
In sum, the bill provides much needed stability and fairness to our tax code, keeps in place important investments in education, infrastructure, and healthcare, strengthens the middle-class, and helps to reduce our deficit.
Here are some specifics (additional information can be found here ) :
= The bill permanently extends all of the Bush tax cuts for incomes below $450,000, while reinstating the Clinton-era 39.6 percent tax rate for income above this
= The bill permanently sets taxes on investment income (capital gains and dividends) at 20 percent for income above $450,000, while keeping the rate at 15 percent for everyone else. This is especially important since, as discussed previously in the Buffet Rule, the wealthiest have enjoyed significantly lower tax rates since most of their incomes come from these investments.
= The bill extends certain middle-class tax credits that came as part of the President’s 2009 Stimulus Package. These include the America’s Opportunity Tax Credit, the Child Tax Credit, and the Earned Income Tax Credit
= The bill extends long-term unemployment benefits (for those 2 million + unemployed for longer than 26 weeks).
= The bill averted a scheduled, steep drop in Medicare payments to physicians
Although Congressional Republicans tried to continue putting millionaires ahead of the middle-class by holding our economy hostage until the very last minute, we must ensure that this new Congress puts the American people above politics and partisanship.
This was a long and hard-fought battle and, luckily, the American people won. Happy New Year!