Resolving the Tax Code Problem

People in California voted on Tuesday to hike the income tax rate on people who make more than $250,000 a year. This is President Barack Obama’s solution to trim the $1 trillion deficit. That’s the easy part though. The difficult part is to come up with the ways to increase the revenues to the U.S. treasury which is a complete reformation of the U.S. tax code. This is difficult in a way that changes in taxes will definitely affect everyone.

Up to now, it is still a guess on how this will be done but Dave Camp, Midland Representative, Republican and Max Baucus, Montana’s Sen., a Democratic, are working on it for 2 years now. They are trying to come up with a tax package that will lower the rate across the board and will lessen the deductions, loopholes, credits etc. For now, they come up for an agreement that included $600 billion in new tax collections and they are still working on it until now.

People are now thinking that these two individual are working on an idea conceived when both of them are under the committee responsible to lower the deficit. More than 100 business leaders including Chairman and CEO of The Dow Chemical Co., Andrew Liveris, signed off on a letter just before the Tuesday election which calling for a balanced approach to deficit reduction. Many believed that the deficit decreased matters. Millions of jobs are at risk in having a tax code that is known to be fair.