Obama floats $1.6B plan to raise taxes

President Obama will push a $1.6 billion plan to hike taxes on the wealthy and corporations in talks on averting the looming fiscal cliff, the White House said. White House press secretary Jay Carney said Obama will advocate raising taxes on corporations and the wealthy by $1.6 trillion over 10 years when he meets with congressional leaders this week. The discussions are to center on how to avert the year-end fiscal cliff of draconian across-the-board budget cuts and expiration of tax rate hikes passed during George W. Bush's presidency, The Washington Post reported Tuesday. Obama's plan is double the amount House Speaker John A. Boehner, R-Ohio, offered Obama during behind-the-scenes debt negotiations in 2011 and calls for more new tax revenue than Republicans had previously been willing to consider. Treasury Secretary Timothy Geithner and other Democrats leaders said Tuesday Obama isn't willing to renew the Bush tax rates in exchange for a cap on deductions for households with annual incomes of more than $250,000, an alternative that's been floated by Republicans. "I don't see how you do this without higher rates. I don't think there's any feasible, realistic way to do it," Geithner said. Republicans have offered new revenue to avoid the fiscal cliff but haven't proposed a specific target. Boehner has suggested that negotiations resume on terms discussed in 2011, when he offered to raise $800 billion over the next decade by a revision of the tax code, which Senate Minority Leader Mitch McConnell, R-Ky., generally endorsed Tuesday, the Post said. Boehner spokesman Kevin Smith didn't comment directly on Obama's opening volley, saying in a statement: "The Speaker proposed a way both parties can work together to avert the fiscal cliff without increased tax rates, through a combination of entitlement reforms and revenue via tax reform. Republicans believe this is consistent with the president's call for a 'balanced' approach, and the Speaker looks forward to talking with the president about such a path." Carney said Tuesday Obama's plan, based on his 2013 budget proposal, would raise tax rates, impose a new special tax on millionaires and scaling back deductions and loopholes, among other things. On Capitol Hill, it wasn't clear how strongly Democrats would resist cutting entitlements, The Wall Street Journal reported. Rep. Chris Van Hollen, D-Md., said he and others were open to changes in entitlement programs if they were done in a measured way and were part of an agreement that included tax increases. He said changing Social Security and increasing the Medicare eligibility age above 65 should be part of negotiations. "I'm willing to consider all of these ideas as part of an overall plan," Van Hollen said Tuesday during the Journal's CEO Council.