President Barak Obama and House Speaker John Boehner will continue fiscal cliff talks at the White House as of Monday morning according to reports issued from the White House. The meetings, however, remain shrouded in a sense of anticipation, however, as no other information was released on the matter.
With two weeks to spare to the fiscal cliff deadline, several sources report that House Speaker John Boehner will drop two key Republican demands in order to avert a looming set of across-the-board tax increases and lowered government spending rates. Reports indicate that Boehner is willing to drop his resistance to higher tax rates for the wealthy and an automatic extension of the federal debt limit.
Boehner is reported by CNBC, however, to have offered $ 1 trillion in total tax revenue over ten years and an increase in the top tax rate of people making over $1 million a year. He is also believed to have made an offer to extend the government’s borrowing cap by $ 1 billion for a year until Congress can revisit the issue in a year.
According to CNBC, the offer was made Friday after a long stalemate. It would bring in $450 billion in revenue from increasing the top tax rate on high-income earners.
Reports from Boehner’s office do not yet confirm such a deal according to an opposing CNN report issued Monday morning, but information from Boehner’s office does not dispute this news either.
“The lines of communication remain open, but there is no agreement, nor is one imminent,” said Boehner’s spokesman, Michael Steel.”
Much of what still lies in question according to analysts is what Obama will counteroffer. Since this major question remains unanswered and there is little time for Congress to agree on any comprehensive deal, there is still a long way to go before any resolution on the issue can be announced.
Despite the continued uncertainty, stocks appear to be on the rise, high on optimism the issue will be resolved. Stocks extended their gains, and the Dow may snap a three-day losing streak as investor confidence is bolstered.
Other reports indicate the super and moderately wealthy that stand to be affected aren’t wasting time to avoid higher taxation. With the gift tax slated to soar unless there is resolution, reports indicate that more wealth has been transferred this year than in the past ten years combined.
Until this latest offer, Boehner has insisted on extending all Bush-era tax rates, rejecting Obama’s demand to let marginal rates increase on incomes over $250,000. If sources are correct in reporting a compromise, what is left to be seen is if Republicans will attempt to raise the threshold to higher numbers, such as $500,000 or $ 1 million.
Speculations are that Congress members will work through the entire holiday season until a deal can be reached, even though it was scheduled to end its work last week. Leaders have warned members to be prepared to work up until Christmas and then be ready to return after the holiday until the year’s end.
