Republicans agree to revenue increases: Senator Kyl

WASHINGTON Wed Jul 6, 2011 7:04pm EDT

1 of 4. U.S. Senate Minority Whip Jon Kyl (R-AZ) (R) departs with an aide after meeting with a bipartisan group of lawmakers and Vice President Joe Biden to work on a legislative framework for comprehensive deficit reduction at the Blair House in Washington May 10, 2011.

Credit: Reuters/Jonathan Ernst

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WASHINGTON (Reuters) - One day before a crucial U.S. budget meeting between the White House and congressional leaders, a high-ranking senator said Republicans have agreed to including significant revenue increases in a deficit-reduction framework.

"If you add up all of the revenues that we Republicans have agreed to, it's between $150 billion and $200 billion," said Senator Jon Kyl, the No. 2 Republican in the Senate.

Kyl said two possible ways to bring additional revenue to the government would be through sales of government property and additional fees for government services,

Meanwhile, House of Representatives Majority Leader Eric Cantor floated a possible tax compromise, saying Republicans could agree to closing some tax breaks in a budget deal as long as they were offset with tax cuts elsewhere.

"Any discussion about loopholes must be accompanied by offsetting tax cuts," Cantor said at a news conference.

Republicans had been adamant about tax increases not being included in a deficit-reduction deal that President Barack Obama hopes clears the way for also increasing U.S. borrowing authority.

In a lengthy speech on the Senate floor, Kyl talked about increased revenues from the sale of government assets or higher user fees.

He criticized, however, Democratic proposals to get rid of tax breaks on corporate jets or tossing an accounting method known as "last in first out" that eases business tax burdens.

Democrats say they have offered up a "menu" of revenue increases of as much as $400 billion in the deficit-reduction and debt limit talks.

If the limit on U.S. borrowing authority, now at $14.3 trillion, is not raised by the Treasury Department's August 2 deadline, there are fears the United States could either miss some debt repayments or be forced into cutting off major government benefits including Social Security checks.

Obama said such an outcome could push the United States economy into a second recession or worse.

On Thursday, Obama is scheduled to meet at 11:15 EDT with a bipartisan group of congressional leaders. Obama will push for a big agreement that could target as much as $4 trillion in savings -- double the size of what had been under discussion, according to Democratic officials. They provided no details on how they would reach that target.

(Additional reporting by Thomas Ferraro, Susan Cornwell, Jeff Mason and Steve Holland in Washington and Richard Leong in New York; editing by Ross Colvin and Jackie Frank)

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Comments (50)
bobsrule99 wrote:
What use is it to meet with President Obama?

He is as partisan as his democrat members in congress!

He will not give an inch on the dems insistence on tax increases in the most severe recession that we have seen in America in many years!

The only solution to this economic catastrophe is to get the dems out of control, cut spending and reform Medicare, Medicaid, welfare and government housing!

Jul 06, 2011 10:13am EDT  --  Report as abuse
papau wrote:
Cutting spending is much much worse to the economy than a tax hike – for the same reason that spending is much better to the economy than a tax hike when you need a stimulus. Spending gets you 1.30 times the cost as GDP growth while that tax change gets you only 0.3 to 0.7 times the cost as a GDP change.

Sp the GOP preach austerity -but all they want is to tank the economy so they win the election in 2012 – in a different era the GOP action would be called treason.

Jul 06, 2011 11:01am EDT  --  Report as abuse
Cru wrote:
@bobsrule,
The president signs the bill. If Republicans won’t budge, they won’t pass anything worth signing.

If the only solution is to get the dems out of control, then I’m afraid you don’t have a solution at all. The debt situation needs to be ironed out now. Also, if you cut assistance programs that you probably call “entitlements” you’ll have a much larger problem on your hands when everyone goes broke without a safety net. The survival of the fittest mantra won’t protect you from desperate people.

Jul 06, 2011 11:14am EDT  --  Report as abuse
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