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Virginia Politics
Posted at 10:06 AM ET, 09/28/2011

Tim Kaine opposes Obama plan to raise capital gains tax

Former Virginia governor Timothy M. Kaine (D) shed more light Monday on his stance toward President Obama’s deficit reduction plan, reiterating his support for letting tax cuts for the wealthiest Americans expire but opposing Obama’s proposal to increase capital gains rates on some high-earning taxpayers.

Kaine is the almost certain Democratic nominee in the contest to succeed retiring Sen. James Webb (D) next year, while ex-senator George Allen is the likely Republican nominee. As Obama’s former hand-picked Democratic National Committee chairman, Kaine’s support for or opposition to his former boss’s proposals will be a key issue throughout the Senate campaign.

Obama has proposed to save more than $3.2 trillion over the next decade, and would let Bush-era tax cuts on the wealthiest Americans expire, while also closing various tax loopholes and asking some of those people to pay a higher rate on their investment income to ensure they pay above some minimum tax rate..

In an interview with NBC12 Monday in Richmond, Kaine said he has “not supported” increasing capital gains taxes, a relatively rare instance where he has disagreed with Obama on a policy proposal.

But Kaine reiterated what he has said for a long time — that he supported letting the upper bracket tax cuts expire. Allen has accused Kaine of supporting tax increases, and Kaine gave a detailed response Monday:

Yeah, he’s completely misstated my position. Letting the Bush era tax cuts expire, even Grover Norquist has said, that’s not a tax increase. The Bush tax cuts in the plan were made temporary, George Allen voted for them to be temporary and they were made temporary for one reason. If you make them permanent, they will completely explode the deficit, so here they are, they’re temporary, they’re set to expire at the end of 2012, and I have supported the element of the president’s plan that would let those tax cuts expire at the top end. That’s not voting for a tax increase. That piece of the plan I support. I also more broadly support the notion, the only way to deal with the deficit is to make cuts first like I did as governor— and George Allen never cut anything— and second, find tax reform like letting these tax cuts expire at the top end and also taking away subsidies from big oil, the companies that don’t need them.

The question of whether letting the Bush tax cuts expire amounts to a tax increase — and whether it violates the pledge circulated by Grover Norquist’s Americans for Tax Reform — has been a hot topic throughout this year’s budget squabbling.

Allen’s campaign claims Kaine is contradicting what he’s said previously about whether these amount to “tax increases.” Last December, when Kaine was still DNC chairman and Obama signed a deal to extend all the Bush tax cuts, Kaine said in a press release that “millions of hard working Americans can now breathe a sigh of relief knowing that their taxes will not increase next year.”

A press release from Allen’s campaign said Kaine was “using Washington rhetoric to try to hide his support for massive tax hikes.”

Kaine’s campaign hit back at Allen and his own record when he served in the Senate.

“George Allen is the only candidate in this race who changed his position,” said Kaine spokeswoman Brandi Hoffine. “He voted to make the Bush tax cuts temporary, knowing full well that making them permanent would create massive deficits. Despite the growing deficits, Allen now supports making the tax cuts for the wealthiest Americans permanent at the expense of tax cuts for Virginian’s families and small businesses.”

Watch Kaine’s full interview with NBC12 below.

By  |  10:06 AM ET, 09/28/2011

 
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