Obama makes $85bn tax cut vow

US presidential candidate targets middle-class voters with attractive package of tax pledges, which would see eligible families receive a $1,000 tax credit

Written by David Jetuah

Accountancy Age, 19 Sep 2007

Presidential hopeful Barack Obama is hoping to sway a sizeable proportion of the US electorate with an aggressive set of tax cut proposals.

Obama presented a fiscal package in Washington yesterday that promised to give citizens earning average wages $85bn (£42.5bn) of tax relief. The primary feature of Obama's designs was to grant a $1,000 tax credit to those entitled .

The package of reforms included a mortgage interest relief of $500 on average for middle-class homeowners and income tax cuts for US citizens earning less than $50,000 a year.

Another major aspect of the proposals was a simplication of the Internal Revenue Service's annual tax form which Obama believed would save the taxpayers $2bn annually in compliance costs.

Obama said that the cuts aimed at those in the median range of US wage income would be offset by the closure of offshore tax havens, the withdrawal of tax loopholes and the raising of capital gains tax from 15% to a possible level of 28 cents in the dollar.