Tuesday, January 8, 2013
New York Times editorial: The Next Round of Tax Increases:
When the White House announced the deal on the fiscal cliff last week, it was quick — and correct — to note that much was left undone. There was still “substantial” room, the administration said, to raise taxes on high-income Americans, to reform corporate taxes and to reform entitlements, with the aim of “balanced” deficit reduction.
The White House seems to think the deal has established a firm foundation for building a new fiscal house. In fact, the deal could make tax reform less likely. And without reform to raise new revenue, deficit reduction would have to rely heavily on spending cuts, an outcome that can be averted only by persuasive and sustained leadership from President Obama....
Mr. Obama has pledged to demand significant tax increases as deficit reduction talks go forward. The fiscal cliff deal could leave him with less room to maneuver. But caps on deductions, higher taxes on investment income and a financial transaction tax are worth fighting for, as are broader tax reforms, like a carbon tax and a value-added tax, that could take effect as the economy recovers.