President Obama is unveiling a new tax proposal Monday to extend the Bush tax cuts for every household earning less than $ 250,000 for one year. The cost: $ 150 billion in lost revenue to the government, according to the Obama administration. By comparison, extending Bush tax cuts to all income levels over the same period would mean $ 210 billion* in lost revenue, says the Center on Budget and Policy Priorities, drawing on figures from Citizens for Tax Justice and the White House.
That’s for the next year. If all the tax breaks are extended beyond 2013, the lost revenue quick ramps up over the next decade: extending them for 10 years would
$ 3.3 trillion*. If they’re extended to everyone earning $ 250,000 and less, it would cost the government $ 2.5 trillion. There’s an alternative proposal to make the cutoff for tax breaks at $ 1 million per household — as House Leader Nancy Pelosi and Sen. Chuck Schumer have proposed — which sits in between.
*Correction: An earlier version of this post cited the figures for the Bush tax cut extension that didn’t fully account for the effect of the Alternative Minimum Tax patch. It didn’t originate from the Bush administration, but it’s been historically been renewed.