The major policy debate in Washington right now is what to do with George Bush's 2001 and 2003 tax cuts that are set to expire this year. The Tax Policy Center, a project of the Urban Institute and the Brookings Institution, has put together a calculator, which MSNBC has publicized, allowing taxpayers to calculate how much they would pay in taxes under three scenarios: a total extension of the 2001 and 2003 tax cuts, an expiration of all of those tax cuts as would take in the absence of Congressional action, or the policy which President Obama favors: an extension of the cuts on income under $200,000 for individuals or $250,000 per family. Those who prefer not to enter all of their information can select from a series of "typical" taxpayers at different income levels. For those who know their taxable income (after deductions) NPR has simplified the calculator.
The other side of the tax question is, of course, the budget deficit. Estimates vary, but Obama's proposal is expected to cost the US Treasury $3 trillion over the next decade compared to allowing all the tax cuts to expire. The Republican plan to continue all of the tax cuts would cost an additional $700 billion for a total cost of nearly $4 trillion.
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