Debate over Bush era tax cuts
There's a long to do list awaiting Washington lawmakers when they return from their August recess. On it, deciding whether to allow the Bush Era tax cuts to expire. As our Washington, D.C. bureau reporter Erin Billups explains, both sides have staked out their positions, setting the groundwork for a bitter fight that could have a noticeable impact on your wallet.
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WASHINGTON, D.C. -- Capitol Hill is quiet now, but the stage has been set for a vicious fight by year's end. A game of chicken, with your taxes.
"Stand with Democrats and the President who have a plan that simply asks America's wealthiest to support this great land," said Queens/Bronx Representative Joseph Crowley.
"There is a strong case to extend the lower Bush era taxes due to expire at the end of the year in order to avert a fiscal cliff," Texas Representative Kenny Marchant said.
If the two parties fail to reach a compromise, the drop off that fiscal cliff will happen on December 31st, when taxes for middle class and wealthy Americans are set to go up.
On July 25th, the Democratic-led Senate passed a bill, supported by the President, that extends tax breaks only for those earning up to $200,000 a year and households making up to $250,000.
"If you want to help the middle class and try to reduce the deficit this is the way to do it," Senator Charles Schumer said.
Then on August 1st, the Republican-led House voted to extend all tax breaks for another year.
"It's time to put the politics aside. I know we're in an election year, but my goodness, raising taxes at this point in this economy is a very big mistake," House Speaker John Boehner said.
The votes in both Houses though were political, largely symbolic. Democrats and Republicans putting their positions on the record before the upcoming elections.
"The American people will have an opportunity to decide come this November between my Democratic colleagues across the aisle and this side of the aisle,” Corning Representative Tom Reed said.
Whether lawmakers can come together after the November elections and reach a deal on tax breaks is anyone's guess.
"We could see ourselves in a real confrontation at the end of this year and those tax cuts could expire," Texas Representative Lloyd Doggett said.
The bold positions taken earlier in the year making it that much more difficult to avoid plunging off that fiscal cliff.