UPDATE 1-White House dismisses Republican 'fiscal cliff' proposal

WASHINGTON, Dec 3 (Reuters) - The White House dismissed a

"fiscal cliff" proposal from congressional Republicans on Monday

that included tax reforms and spending cuts, saying it did not

meet President Barack Obama's pledge to raise taxes on the

wealthiest Americans.

"The Republican letter released today does not meet the test

of balance. In fact, it actually promises to lower rates for the

wealthy and sticks the middle class with the bill," White House

Communications Director Dan Pfeiffer said in a statement.

He was referring to a proposal laid out in a letter by House

of Representatives Speaker John Boehner and other Republicans.

"Their plan includes nothing new and provides no details on

which deductions they would eliminate, which loopholes they will

close or which Medicare savings they would achieve," Pfeiffer

said.

"Independent analysts who have looked at plans like this one

have concluded that middle-class taxes will have to go up to pay

for lower rates for millionaires and billionaires."

Boehner proposed overhauling the U.S. tax code to raise $800

billion in new revenue over ten years. Obama's opening bid,

outlined on Capitol Hill on Friday, seeks $1.6 trillion in new

revenue by allowing the expiry of tax cuts enacted under

President George W. Bush for the top two tax brackets.

After winning re-election last month with a campaign pledge

to raise tax rates for the wealthiest Americans, Obama will not

agree to extend the Bush-era tax cuts for the richest 2 percent

of U.S. households, senior administration officials said.

The officials said the White House would likely continue to

discuss ways to avert the "fiscal cliff" in phone calls with

their negotiating counterparts in Congress.

Some conversations might take place at the White House's

annual holiday party on Monday night, they said.

But after the Republicans made an offer that runs counter to

Obama' main demand for higher tax rates, the officials said they

believe it is now up to congressional Republicans to take steps

to advance negotiations.

Once Republicans agree that tax rates must rise, achieving a

broader deal to reduce the budget deficit will be much easier,

the officials said.

Most Popular in Business