Obama Wants a $300 Billion Tax Cut

The incoming American president Barack Obama wants a decrease in taxes of about 300 billion dollars (215 billion euro) to stimulate the weak American economy.

Obama was scheduled to discuss the plans on Monday with members of Congress, The Wall Street Journal, an American business newspaper, reported.

The tax cuts in the next two years are a part of Obama’s extensive economic aid package that may cost between 750 billion and a trillion dollars. The tax cuts will apply to both citizens and companies.

Plans Might Be Underway in February

With these measures Obama hopes to combat the most serious recession in the United States in decades. According to the Democrats, the plan could be approved by Congress as early as February, shortly after Obama is sworn in as president. He will still be looking for support for his plans from the Republicans in Congress.

Individuals will be able to get a tax cut of 500 dollars. These tax cuts should lead to higher consumer spending that will benefit the economy.

Tax Cuts for Employing Personnel

Obama also wants to give tax cuts to companies who hire more employees, in an effort to create or keep 3 million jobs by 2011. This could cost the government 40 to 50 billion dollars. Last year almost 2 million jobs were lost. It is estimated that in December alone at least a half a million jobs were lost. New employment rates will be announced on Friday.

Depressed Housing Market

The American economy is under great pressure by the depressed housing market and the financial crisis. Analysts fear that the world’s biggest economy could shrink 4.3% in the fourth quarter, which would be the strongest economic decline since 1982.