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Obama backs off tax increases; Schwarzenegger mulls tripling car taxes, raising pet taxes, and more

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By Michelle Malkin  •  November 23, 2008 11:05 PM

Welcome to the funhouse mirror world of Rebranding 2008.

Team Obama reportedly is backing away (for now) from its signature campaign pledge to roll back the Bush tax-cuts on wealthy Americans…

President-elect Barack Obama may consider delaying a campaign promise – to roll back tax cuts on high-income Americans – as part of his economic recovery strategy, two aides said on Sunday.

David Axelrod, the Obama campaign strategist who was chosen to be a senior White House adviser, was asked if the tax cuts could be allowed to expire on schedule after tax year 2010 rather than being rolled back by legislation earlier. “Those considerations will be made,” he said on “Fox News Sunday.”

Bill Daley, an adviser to Obama and commerce secretary under former President Bill Clinton, said on NBC’s “Meet the Press” that the 2010 scenario “looks more likely than not.”

President George W. Bush’s tax cuts are set to expire at the end of 2010. After that they would revert to 2001 levels, when the top individual tax rate was 39.6 percent.

Obama has called for reducing taxes for the middle class, but requiring the wealthiest Americans to pay more than the current top rate of 35 percent.

His aides’ comments suggest Obama may be wary of imposing any additional tax burden at a time of deep crisis, despite the outlook for record budget deficits and mounting national debt. He may also be seeking to bolster Republican support for his recovery measures.

Meanwhile, GOP Gov. Arnold “Rebrand the GOP” Schwarzenegger is mulling possible hikes in California’s vehicle license fees – the very idea that got Democrat Gov. Gray Davis kicked out of office. Brilliant (hat tip – Patterico):

State lawmakers began moving toward a deal this week to close California’s deficit with the help of steeper car fees that would cost many drivers hundreds of dollars annually, according to people involved in budget talks.

Under the plan, GOP lawmakers — most of whom have signed anti-tax pledges — would vote to triple the vehicle license fee that owners pay when they register their cars every year in exchange for a ballot measure that would impose rigid limits on future state spending. Motorists’ annual license fees would rise from 0.65% of the value of their vehicles to 2%. For a car or truck valued at $25,000, the increase would be $336.

The higher fees would generate $6 billion annually, helping to fill a budget gap that is projected to reach nearly $28 billion over the next year and a half.

The proposal is being championed by incoming state Senate leader Darrell Steinberg (D-Sacramento). Democrats and advocates for the poor have opposed strict state spending limits, saying they would cripple government services.

…In a meeting with Times reporters and editors last week, the governor said he would not rule out raising the car tax.

“Everything is always on the table,” Schwarzenegger said when asked about the prospects for a sharp increase in vehicle license fees. “If I hate something, you can bring it up and you can show to me why that is a good idea, and maybe you know with the new circumstances, there is a good idea that I maybe looked at it in the past and didn’t think it was a good idea. This is a crisis situation and one has . . . to look at it in a fresh new way.”

More “fresh” taxes on the table:

Potentially just days from now, Governor Arnold Schwarzenegger will be moving to tax veterinary services for your pets.

According to the Governor’s website, his new budget proposal would mean “[e]ffective February 1, 2009, the sales and use tax rate will be applied to appliance and furniture repair, vehicle repair, golf, and veterinarian services. Effective March 1, 2009, the sales and use tax rate will be applied to amusement parks and sporting events.”

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Categories: Arnold Schwarzenegger, Politics

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