On Tax Day, Obama Talks About Simpler Returns

For the thousands of Americans scrambling to file their tax returns before today's midnight deadline, President Obama had (some) words of reassurance: He plans to simplify a "monstrous" and "far too complicated" tax code to ensure that "April 15 is not a date that is approached with dread each year."

In order to do that, the president said in remarks today, he has asked his Economic Recovery Advisory Board, headed by former Federal Reserve Chairman Paul Volcker, to review how to simplify the code. A report is due before the year's end. "It will take time to undo the damage of years of carve-outs and loopholes," Obama said, but "we will rewrite the tax code so that it puts your interests over any special interest." The ultimate goal, he said, was to make it "quicker, easier, and less expensive" to file a return.

But the board's efficacy in doing so may be hindered, with complaints surfacing recently on its disorganization and some degree of marginalization from Obama's economics team. Established in November, the full group has not yet met together. The Wall Street Journal reported last week that Volcker had not seen Obama for nearly a month and has been sidelined in key fiscal decisions.

As well as speaking about his next moves on the tax code, Obama reiterated the changes his administration has already made. The 95 percent of American workers eligible for the "making work pay" tax cut, which he called "the most progressive tax cut in American history," should already have begun seeing a bounce in their paychecks. By boosting demand, that cut will save or create more than 500,000 jobs, he said. Other big changes have included the decision to allow small businesses to offset their losses during the recession through tax refunds, the $2,500 college tuition tax credit, and the $8,000 credit for first-time home buyers, Obama said.

In an attempt to allay criticisms of being a big spender, which have come on the heels of his $787 billion stimulus package and billions of dollars in bailouts, Obama emphasized that his administration will promote fiscal responsibility along with tax cuts. In particular, he said, it has identified $2 trillion in deficit reductions over the next 10 years. The tax code also should be revised, he said, to stop giving tax breaks to corporations that outsource jobs or to the wealthiest 2 percent of Americans.

Even as Obama spoke, demonstrations in 700 cities and towns across the country gathered to protest in a series of "TEA"—or "taxed enough already"—parties. The movement was inspired by CNBC's Rick Santelli, who called in February for a "Chicago tea party" to show anger over taxing Americans to bail out mortgage defaulters or, as he put it, to "subsidize the losers' mortgages."

• Read Obama: On Economy, 'We Are Beginning to See Glimmers of Hope.'
• Read 10 Winners in the Recession.