McConnell slams Obama tax hikes

Sen. Mitch McConnell, R-Ky., said President Barack Obama’s plans to end some of the tax cuts instituted by the Bush Administration will hurt small businesses already struggling in the recession. “A vast majority of American small businesses pay taxes as individual taxpayers so we have got to ask ourselves whether increasing capital gains taxes, dividend taxes and taxes on small businesses is a great thing to do in the middle of a deep recession,” McConnell said Sunday on CNN’s State of the Union.  “I think most of my members will think that that’s not a smart move.”

The Obama Administration Saturday indicated it would reduce the massive national deficit in part by letting the Bush tax cuts lapse after 2010, which would in effect raise the income tax rate from 35 percent to 39.6 percent for families earning more than $250,000 and increase the capital gains tax from 15 percent to 20 percent.

House Minority Leader John Boehner, R-Ohio, said in a statement on Sunday the Obama plan to raise taxes “will do further damage to the economy, discouraging families from working and threatening the very jobs the president wants to help our economy create.”

Boehner also panned the administrations plans to reduce the deficit by reducing the U.S. military’s role in Iraq, which he said, “could jeopardize our troops and their ability to complete their missions safely and successfully.”

Obama’s tax cut plan will be included in the budget outline he will send to Congress on Thursday.