The top tax rate is now 35% which is well below the high of 39.6% under the Clinton Administration. There may be reasons not to increase this to the full Clinton level. However, we should be able to agree to raise the top rate to 38% and leave the other tax rates as they are. This would be a victory for both sides.
Why is this important?
This issue needs to be settled before the Fiscal Cliff at the end of 2012. If this is not done then taxes will increase and severe budget cuts will automatically kick-in. This will cause disruption and could provoke a second recession.
