White House won't accept new tax offer from Republican leader: source

White house

President Barack Obama is not ready to accept a new offer from the Republican leader of the U.S. House of Representatives to raise taxes on top earners in exchange for major cuts in entitlement programs, a source said late on Saturday.

The shape and details of Boehner's offer were uncertain Saturday night, as was the exact reason the president was prepared to reject it.

The source said the White House sees the offer made on Friday by U.S. House Speaker John Boehner as a sign of progress, but simply believes it is not enough and there is much more to be worked out before Obama can reciprocate. Tax rates and entitlements are the two most difficult issues in the so-far unproductive negotiations to avert the "fiscal cliff" of steep tax hikes and spending cuts set for the new year unless Congress and the president reach a deal to avoid them. The Boehner offer is the first significant sign of a shift in the Republican insistence that low tax rates set to expire on Dec. 31 be extended for all taxpayers, and comes at some risk to the speaker. Conservatives, particularly Tea Party-supported Republicans, see opposition to tax increases for anyone as an abandonment of party principles, and of the Republican base.

Obama wants high earners - those earning roughly $250,000 a year or more - to pay higher taxes in order to put the burden ofdeficit reduction on those he says can best afford it.

Republicans have privately spoken of coming back at Obama with a threshold of $1 million. Obama has previously called that unacceptable because it would not raise enough money on its own to cut the deficit significantly or provide enough money to avert across-the-board spending cuts. On entitlements, the president faces pressures of his own from Democrats, who see protecting Medicare, the government health insurance program for seniors, as a bedrock principle.

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