Economic Choices 2008 - Obama & McCain & Taxes
Tuesday, June 10, 2008SUSIE GHARIB: Jobs, taxes and the economy took center stage in the presidential campaign today. Senators Barack Obama and John McCain each accused the other of backing economic plans that would hurt the middle class and undermine growth. As the candidates focus on the economic choices facing voters this November, Darren Gersh takes a closer look at their tax plans.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: It is not very exciting to talk trash about the other guy's plan for business tax cuts, but the presidential candidates did their best today. Here's Senator John McCain telling a small business group that Senator Obama's plan to repeal much of the Bush tax cuts would amount to the largest tax hike since World War II.
SEN JOHN MCCAIN (R) PRESUMED PRESIDENTIAL NOMINEE: Under Senator Obama's tax plan, Americans of every background would see their taxes rise -- seniors, parents, small business owners and just about everyone who has even a modest investment in the market.
GERSH: After touring a hospital today, Senator Obama fired back. Obama charged McCain's call to cut the corporate income tax would add close to $300 billion to the deficit. As for his own plans, Obama cited support from the Oracle of Omaha.
SEN. BARACK OBAMA (D) PRESUMED PRESIDENTIAL NOMINEE: If we sent the capital gains rate up to 20 percent, my discussions with people like Warren Buffett indicate that it will probably not have any significant impact in terms of investment.
GERSH: Obama ruled out a return to capital gains tax rates of 40 percent or higher, saying nobody is talking about that. And he laid out the general theme of this tax plans.
OBAMA: What we're trying to do is restore some balance, put some money in the pockets of working families, in the pockets of consumers. That, actually, I believe will be good for business.
GERSH: McCain's pitch to business was more direct.
MCCAIN: I intend to keep the current low income investment tax rate. I intend to keep them, not repeal them.
GERSH: Deloitte tax analyst Clint Stretch says the most important thing for business owners and investors to understand about the candidates and their business tax plans is that they don't add up.
CLINTON STRETCH, MANAGING PRINCIPAL, TAX POLICY, DELOITTE: The problem with John McCain's business plan is that he hasn't said how he's going to pay for it. We have huge deficits going out in the future. He isn't telling you where the money for that big tax cut for business comes from. The problem with Obama's tax plan for corporations is that he says it's going to raise a lot of money. The corporate income tax just doesn't raise a lot of money to begin with.
GERSH: For now, Stretch recommends reading the candidates' tax proposals as political documents -- more like a good sign of the overall direction the next president intends to take the country, rather than a detailed map of how to get there. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.
