Thune calls raising income taxes the 'Holy Grail' for Democrats

Democrats have proposed letting the George W. Bush-era tax rates expire at the end of the year on people making more than $250,000, but Republicans say that will harm the economy and the rates should be extended for all income levels.

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Thune said President Obama’s tax plan would only fund the federal government for “about a week.”

“What we need is higher economic growth, not higher taxes,” Thune said. “Our budget situation today has to do with Washington’s addiction to overspending.”

Lawmakers are working to avoid the “fiscal cliff” at the end of the year when the Bush-era tax rates expire and sequestration takes effect.

Last week, Obama released a proposal that would raise $1.6 trillion with higher taxes, find $400 billion in savings from entitlements and spend $50 billion on measures to stimulate the economy.

Republicans have said it is a one-sided offer that shows the White House isn’t serious about the talks. House Republicans this week made a counteroffer that includes $800 billion in new tax revenues, but the White House rejected it, demanding higher tax rates on the wealthy.

Thune said Obama’s tax plan would harm small businesses.