RANCHO CORDOVA (AP) — The federal government should extend tax cuts for everyone, including the wealthy, during “an economically devastating period,” Republican U.S. Senate candidate Carly Fiorina said Monday.

The former chief executive officer of Hewlett-Packard Co. was asked during a campaign stop in the Sacramento suburb of Rancho Cordova if she would allow Bush-era tax cuts to expire for everyone if she could not get them extended for the wealthy. Fiorina did not answer directly, but rather maintained that everyone should have their tax cuts extended.

“I think this is a really simple matter. We are in the middle of a disastrous economic time here in California,” Fiorina said. “You do not raise taxes in the middle of an economically devastating period of time. Period.”

Like President Barack Obama, Democratic Sen. Barbara Boxer has said she supports extending the tax cuts only for lower-income and middle-class taxpayers. The president on Monday repeated his opposition to extending tax cuts for those with household incomes above $250,000 — but to extend them for everybody else.

Fiorina is challenging Boxer’s bid for a fourth term in the Senate. Boxer’s campaign did not immediately respond Monday to a request for comment.

Republicans and Democrats in Congress continue to clash over the issue, which could sway voters in the November midterm elections. House Minority Leader John Boehner, R-Ohio, has said he would support renewing tax cuts for the middle class but not the wealthy if that were his only choice.

Fiorina said the tax cuts for the highest earners help small-business owners such as the one she visited Monday.

George Pappas, managing partner of Dynamic Digital Displays, said he faces an additional $15,000 in income taxes if the tax cuts expire at the end of the year, as they are scheduled to do without congressional action. He counts the company’s profits toward his personal income.

The five-year-old limited liability company has 45 employees and makes large LED displays and signs for advertising.

“Unfortunately, small-business owners get grouped in with people making $2 million to $3 million a year,” Pappas said. “We’re a lot different. I didn’t take a salary for two years, and now that I’m starting to be able to pay back the debt I incurred when I didn’t take a salary, I’m asked to pay more.”

The Tax Policy Center, a nonpartisan organization in Washington, D.C., analyzed the president’s proposal earlier this year. It found that 3.4 percent, or 5.4 million households, would be hit with higher income taxes if Congress goes along with the president’s recommendation.

Democratic leaders have said scrapping some of the tax cuts is necessary to begin reducing the federal budget deficit. Fiorina has said those efforts should be focused solely on cutting government spending.

(Copyright 2010 by The Associated Press. All Rights Reserved.)


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