June 29, 2011 By John D. McKinnon
President Barack Obama hit Republicans over tax breaks for corporate jets at least four times in the opening moments of his news conference, seeking to dial up pressure on the GOP to accept tax increases as part of a budget deal.
A visitor walks past a corporate jet at the Australian International Airshow and Aerospace and Defence Expo in March. (Paul Crock/AFP/Getty Images)
Republicans weren’t having it. They suggested repeal of the corporate-jet break – which they’ve so far opposed – is a stalking horse for much larger tax increases that Democrats really want.
“Interesting that he keeps pointing to corporate planes and oil/gas as the only examples of the tax hikes he wants,” said Don Stewart, Sen. Mitch McConnell’s spokesman, in an email to reporters. “Odd that he doesn’t mention things like his plan to raise $70 billion on manufacturers and small businesses” through changes in tax accounting methods.
That itself was a bit of Republican posturing – the president also talked about raising basic taxes on millionaires and billionaires during his appearance.
Still, Wednesday’s exchange highlights the extent to which the tax debate is becoming political theater as the two sides negotiate a deficit deal.
Democrats effectively lost the last fight over taxes in December, when the Bush-era breaks were up for renewal. Back then, Republicans successfully portrayed tax increases as a threat to small businesses and jobs.
This time around, Democrats are trying a couple of new tactics.
They are focusing on much narrower provisions such as the corporate jet break. It’s an obscure advantage that corporate jets enjoy over commercial airliners in tax-depreciation schedules; its repeal likely would raise relatively little money for the government – about $3 billion over the next decade, GOP aides said.
Perhaps more important, Democrats also are trying to connect GOP tax resistance directly to middle-class benefit cuts.
“If we choose to keep those tax breaks for millionaires and billionaires, if we choose to keep a tax break for corporate jet owners, if we choose to keep tax breaks for oil and gas companies that are making hundreds of billions of dollars, then that means we’ve got to cut some kids off from getting a college scholarship,” said Mr. Obama (who happens to have the coolest jet of all). “That means we’ve got to stop funding certain grants for medical research. That means that food safety may be compromised. That means that Medicare has to bear a greater part of the burden. Those are the choices we have to make.”
http://blogs.wsj.com/washwire/2011/06/29/gop-attacks-obamas-call-for-ending-tax-breaks-for-corporate-jets/
Source: WSJ WASHINTON WIRE
Date: 2011-06-29