|by David Jackson, USA TODAY|
In the prime-time address Tuesday, the president plans to call for ending certain loopholes on trust funds, increasing the top tax rates on dividends and capital gains, and imposing new fees on big financial firms that borrow heavily.
Obama also plans to propose new tax breaks for families that have a second working member, child care and the costs of college education, according to a
He will propose a requirement for businesses that do not have a retirement plan to automatically enroll employees into individual retirement accounts.
The package is designed "to simplify our complex tax code, make it fairer by eliminating some of the biggest loopholes, and use the savings to responsibly pay for the investments we need to help middle-class families get ahead and grow the economy," says a
Republicans who control both the
Republican leaders have also said they would work with Obama on simplifying the tax code, one of the goals of the president's package.
Senate Majority Leader
In unveiling a plan to be discussed at the State of the Union, the Obama administration said that closing loopholes for the wealthy would generate revenue of
An administration statement said that "hundreds of billions of dollars" in inherited assets that are part of trust funds escape taxation every year, and called for the elimination of this "trust fund loophole."
Another proposal is to increase the top rates on long-term capital gains and dividends from 20% to 28%, the level they were at during the Reagan administration.
The proposed fee on financial firms would discourage them from over-borrowing, one of the things that led to the financial meltdown, the
Some of the revenue from these loophole closings would be used for tax breaks designed to "reinvest in the middle class," said the
They include a proposed
Another State of the Union plank would triple the maximum child care tax credit, providing up to
A proposed requirement that workers be enrolled in some kind of retirement savings plan would apply to employers who have more than 10 employees.
Obama and aides have spent the past two weeks promoting other items he plans to discuss Tuesday, including proposals on housing, manufacturing, community college, cybersecurity and paid leave.
In his Saturday radio address, Obama previewed some of the people who will sit in the presidential box during the speech.
They include a woman who expanded her business through a federal loan, a wounded warrior who fought in
Obama told the radio audience that his State of the Union Address will emphasize economic recovery and "how to build on our momentum" through rising incomes and a stronger middle class.
"And I'll call on this new