By Russell Berman - 05/08/12 09:27 PM EDT
The House will vote before the November elections to extend all of the current tax rates that are set to expire at the end of the year, Speaker John BoehnerJohn BoehnerNew Trump campaign boss took shots at Ryan on radio show Election reveals Paul Ryan to be worst speaker in U.S. history Getting rid of ObamaCare means getting rid of Hillary MORE (R-Ohio) said Tuesday.
BoehnerJohn BoehnerNew Trump campaign boss took shots at Ryan on radio show Election reveals Paul Ryan to be worst speaker in U.S. history Getting rid of ObamaCare means getting rid of Hillary MORE warned about a “train wreck” of big-ticket legislation that could be left for a lame-duck session if Congress doesn’t act beforehand.
“The House is going to act to extend the current tax rates. Whether we make them permanent or extend them for a year — that debate is still up in the air,” Boehner said in an interview on CNBC.
“Otherwise we’re going to have this mess all stacked up until after the election. And you want to talk about a train wreck? You’re talking about a big one.”
The Speaker ticked off a list of must-pass items before the end of the year, including the tax provisions, federal spending bills and another potential increase in the debt ceiling. Lawmakers also face the expiration of a payroll tax cut that was the subject of a political showdown last Christmas, and $1.2 trillion in required spending cuts triggered by the 2011 deal to raise the debt ceiling.
Federal Reserve Chairman Ben Bernanke has described the prospect of higher tax rates and spending cuts as a “fiscal cliff” that could be perilous for the economy.
“What are we going to do with all the tax rates between Thanksgiving and Christmas?” Boehner asked. “What are we going to do about funding the government for all of next year? What are we going to do about the debt limit we’re probably going to be up against? We’re going to wait until the end of the year to do all of this?”
Any vote on taxes before the election is likely to be politically charged, particularly if it comes near the height of a general-election campaign expected to be dominated by debates over taxes, government spending and the economy.
Few analysts believe that any major agreements are likely before the presidential and congressional elections in November, and Boehner said little to raise those hopes.
“I’ve been in Washington long enough to know I shouldn’t have high expectations, especially with the United States Senate,” he said.
And the Speaker suggested that the Senate would have to act before any serious negotiations could begin.
“The House is prepared to extend all the current tax rates,” Boehner said. “The Senate has to act. Until the Senate acts, it’s hard to determine how we deal with this.”
President Obama supports the extension of the Bush tax rates for the middle class but not for top earners. Any move to extend the current rates would have enormous implications for the deficit.
Boehner reiterated that Republicans are pushing an overhaul of the tax code that would reduce the top individual income rate to 25 percent, but that is not expected to occur before 2013.
He sounded a pessimistic note on the economy, saying it was “slowing” and that he would not be surprised if it continued to slow, in part due to uncertainty emanating from Europe and from the possibility of large tax increases if Congress doesn’t act.