On Thursday, Treasury Secretary Timothy Geithner met with Republican Congressional leaders and proposed a two-step process to raise $1.6 trillion in new revenue. The first step would net $960 billion immediately by allowing the Bush-era tax cuts to expire on top earners along with raising rates on dividends and capital gains. Another $600 billion would come from overhauling the tax code next year to reach the $1.6 trillion goal. Geithner also pressed for a patch of the alternative minimum tax and the extension of targeted business tax breaks at a cost of $236 billion.
Under Geithner’s proposal, the estate tax would return to its 2009 levels, when a 45 percent rate was imposed on inheritances worth more than $3.5 million.
Geithner also proposed deferring the scheduled $109 billion sequestration cuts. He proposed appropriating an additional $25 billion in stimulus spending, above the current baseline, for six years, with $50