Holiday Treat for the Bush Tax Cuts?

Alison Acosta Fraser / December 06, 2010

Maybe it’s the holiday season, but if the reports are true President Obama and congressional Republicans have reached a compromise on extending the Bush tax cuts that gives taxpayers and the economy a wondrous gift.

While details are sketchy and ever-so-important, President Obama announced he has agreed to extend all the Bush tax cuts for two years, through 2012. The necessity of economic growth trumped the ideology of redistributionism, though the President did take plenty of jabs at the wealthiest Americans. The compromise also includes the unfortunate resurrection of the death tax, but at a less punishing rate of 35 percent combined with a $5 million exemption. Two things to remember as the debate turns over to Congress: keeping current tax policy is not a tax cut, it’s preventing a tax hike, and would let all Americans keep more of their own money. Since this isn’t a tax cut, it doesn’t need to be “paid” for. The unfortunate part of this compromise is that it is not a permanent extension which would have been far better for the economy. (more…)