Carl Levin: Tax Hikes Left Out Of Spending Debate

As both Houses work to strike agreement over the 2011 spending bill, Sen. Carl Levin (D-Mich.) said a key issues has been left out of the debate — revenue increases.

The Chairman of the Armed Services Committee said raising taxes 3 percent on those families making more than $250,000 — a proposal which was rejected in December — would raise nearly $40 billion per year. Neither the Republican or Democrat spending bill set to be voted on in the Senate today address revenue.

“If you don’t extend that tax cut, you pick up enough money for the treasury to pay for most of the discretionary cuts that are in the House bill (H.R. 1),” Levin told the Jewish Council for Public Affairs Tuesday during their annual meeting.

The three percent tax cut signed into law during the Bush administration was set to expire at the end of 2010 but was extended for two years as part of a tax compromise signed in December that also extended tax cuts to middle-class families. Levin said those making more than $250,000 are the only one’s who have benefited financially in the past decade.

“We understand, as our parents and grandparents understood, that you need a government which will provide safety net and provide opportunity, and that means we need to contribute to that government,” Levin said.

Levin also said the government needs to make the corporate tax system more fair by closing loopholes, citing as one example the lack of taxes on U.S. companies profit overseas. Those profits are not subject to taxes until it is brought back into the U.S.