Economy & Budget

Republicans split on Boehner’s tax increase plan

Republicans split on Boehner’s tax increase plan

Republicans are at odds over House Speaker John Boehner’s “Plan B” tax hike proposal calling into question whether the legislative remedy to avoid the fiscal cliff has enough votes to pass the House on Thursday.

Boehner (R-Ohio) made a brief statement during a one-minute press conference Wednesday predicting his plan would pass, before shifting the blame for it’s ultimate failure into the lap of President Barack Obama.

“The president will have a decision to make. He can call on the Senate Democrats to pass our bill, or he can be responsible for the largest tax increase in American history,” Boehner said.

But some conservative organizations are urging their followers to call their respective representatives and urge them to oppose the plan.

With conservative tea party Republicans controlling roughly 70 votes, Boehner’s plan to raise taxes on Americans making more than $1 million annually could be defeated if Democrats also maintain a party line vote against the measure.

“Allowing a tax increase to hit a certain segment of Americans and small businesses is not a solution; it is a political ploy,” said Heritage Action for America, the political arm of the Heritage Foundation.

“Taking money out of the private sector to fund the public sector is not only misguided, it is counterproductive. Reversing course on the need for higher taxes will only serve to embolden the left’s big-government agenda. History has shown tax increases do little to stem annual deficits; in fact, deficits tend to increase,” Heritage Action for America said.

Both Heritage Action and the Club for Growth say they will “score” lawmakers’ votes on the issue for their legislative scorecard – a weapon that can be used by political opponents at reelection time to criticize it as a tax hike vote.

“On the substance, this bill is anti-growth. It increases tax rates for those making over $1 million while also raising taxes on capital gains and dividends. We don’t buy into the Washington-speak, suggesting that these are actually tax cuts,” Club for Growth said in a statement.

Additionally, a coalition of conservative leaders held a press conference this afternoon outside the Capitol to oppose the plan, which closely mirrors a tax proposal put forth by House Minority Leader Nancy Pelosi (D-Calif.) earlier this year.

“When the American people voted to return the Republican majority in the House last month we sent you to cut spending. Instead, you are now voting on the Pelosi plan to increase taxes next year,” said the coalition, which includes former Attorney General Edwin Meese and some tea party leaders.

Interestingly, the anti-tax group Americans for Tax Reform (ATR) led by Grover Norquist says it will not consider a vote in favor of the measure a violation of its “taxpayer protection pledge” that many Republican lawmakers have signed vowing to vote against tax increases.

“Republicans supporting this bill are this week affirming to their constituents in writing that this bill—the sole purpose of which is to prevent tax increases—is consistent with the pledge they made to them. In ATR’s analysis, it is extremely difficult—if not impossible—to fault these Republicans’ assertion,” the group said in a statement.

“In particular, in this Congress the House has already voted twice to prevent any tax increases on any American. When viewed with this in mind, and considering this tax bill contains no tax increases of any kind—in fact, it permanently prevents them—matters become more clear. Having finally seen actual legislation in writing, ATR is now able to make its determination about a legislative proposal related to the fiscal cliff,” the tax group said.

Boehner and Obama are deadlocked over reaching a compromise to extend or block all of the Bush-era tax cuts and roll back spending cuts that go into effect on Jan. 1.

Boehner’s “plan B” bill keeps taxes lower on those making less than $1 million.

Obama also criticized the proposal during a press conference today announcing his new task force to examine the Connecticut school shooting tragedy. Obama suggested that tragedy and other misfortunes should persuade Republicans to side with the president’s proposal to raise taxes on Americans making more than $250,000.

“When you think about what we’ve gone through over the last couple of months — a devastating hurricane, and now one of the worst tragedies in our memory, the country deserves folks to be willing to compromise on behalf of the greater good and not tangle themselves up in a whole bunch of ideological positions that don’t make much sense,” Obama said.

Obama is planning to spend his Christmas holiday in Hawaii beginning on Friday, but he told lawmakers they should stay in town until they reach an agreement with the White House.

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