An Overview of Major Tax Proposals in the President's Fy2012 Budget

The Obama Administration released the President's FY2012 budget proposal on February 14, 2011. According to the Administration's estimates, the tax proposals in the budget would increase revenues $280 billion over the next 10 years. The Administration's estimates were made relative to a current policy budget baseline, which assumes certain polices that are scheduled to change in the future by law will not. In contrast, the Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) make their projections relative to a current law budget baseline, which assumes future policy changes will occur as prescribed by current laws. This difference in baselines may result in the Administration's estimates being different than future CBO and JCT estimates. This report provides a broad overview of the provisions included in the President's budget request. The budget groups proposed tax provisions into several general categories. Congress has begun its consideration of the President's budget. The House and Senate Budget Committees are responsible for formulating and reporting an annual budget resolution. The budget committees typically develop the budget resolution as they receive information and testimony from various sources, such as the Administration, CBO, and congressional committees with jurisdiction over spending and revenues.