Tax cuts established by the Bush administration are being extended
Tim Geithner, the Treasury Secretary, says that the Obama administration intends to let tax cuts for wealthy Americans expire, and will extend them for the rest of the nation.
The Obama administration also favors businesses by protecting them from restoring taxes to higher levels than they are now. The reason for protecting businesses is that they hire new employees, they invest and expand, and this would not be possible if they are paying high taxes which would cut the money for new projects and development. Republicans claim that letting taxes drop for those Americans that are earning more than 250,000 dollars a year will not help the economy while it is trying to recover from recession. Some critics argue that if Americans earning more than 250,000 dollars a year have to pay higher taxes, then so should many small business owners.
The plan of the Obama administration is to extend the tax cuts established by the Bush administration for more than 95 percent of the population and let them expire for about 3 percent, which are supposed to be ones that earn the highest incomes. Geithner said that he does not believe that letting tax cuts expire would harm the recovery of the economy or would have a negative effect on its growth. By now the government succeeded in restoring private sector job growth.
