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Obama Wants to Tap Wealthy to Cover Jobs Bill Expenses

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President Obama has proposed to pay for the American Jobs Act he sent to Congress on Monday largely through tax increases on wealthy Americans.

The largest revenue-increasing measure applies to individuals with adjusted gross incomes of more than $200,000 or couples with more than $250,000.

It would take effect on Jan. 1, 2013, when Bush-era tax income rates of 33 percent and 35 percent for the highest income brackets will revert back to 36 and 39.6 percent.

The administration said that measure would raise around $400 billion over 10 years by capping itemized deductions at 28 percent and by eliminating certain exemptions.

The president also proposed to tax some of the money paid to investment fund managers as ordinary income. Currently considered capital gains, those funds are taxed at a flat 15 percent rate. Now, the government could collect up to 39.6 percent of the money.

Obama also proposed eliminating some oil subsidies for an estimated savings of $40 billion over 10 years. Another measure would decrease savings associated with purchasing corporate jets and raise an estimated $3 billion over that period.

The proposed legislation also includes $200 million in tax cuts.

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