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Sen. John McCain (AZ)
Tax Policy: McCain would try to make President Bush's tax cuts permanent for individuals and businesses. Those tax cuts are scheduled to expire in 2010. McCain would also make permanent the research tax credit for businesses. McCain says he wants to completely eliminate the alternative minimum tax. Originally designed to make sure millionaires pay taxes, the AMT is now affecting millions of middle-income taxpayers. McCain supports a ban on Internet taxes and says any tax increase should require a three-fifths majority in Congress. He also supports supplementing Social Security with personal accounts — but not as a substitute for addressing Social Security benefit promises that he believes cannot be kept.
Fiscal Discipline: McCain says the practice of excessive borrowing and deficit spending by the federal government must stop.
Economic Stimulus: McCain would cut the corporate tax rate from 35 percent to 25 percent and allow first-year expensing of equipment and technology investments by businesses. In addition, McCain would provide a permanent tax credit equal to 10 percent of the amount businesses spend on wages and on research and development.
Sen. Barack Obama (IL)
Tax Policy: Obama would reverse President Bush's tax cuts for upper-income taxpayers and provide 150 million low- and middle-income workers a tax credit of up to $500. He proposes eliminating income taxes for seniors earning less than $50,000 a year and tripling the earned-income tax credit — to $555 — for full-time minimum wage workers. Obama also proposes a mortgage tax credit for homeowners who don't itemize deductions, and he would make the research credit permanent.
Fiscal Discipline: Obama says he would restore fiscal discipline by requiring new government spending to be paid for by revenue increases or cuts in other programs.
Economic Stimulus: Obama is calling for an additional $50 billion in economic stimulus due to recent job losses, including expanded unemployment benefits and foreclosure relief.