McCain tax cuts vs. Obama tax cuts

WASHINGTON, Oct. 17 (UPI) -- U.S. presidential hopefuls John McCain and Barack Obama have plans to cut taxes, but the impact on taxpayers and the deficit differ, an analysis indicates.

Republican McCain wants to extend the Bush administration's 2001 tax cuts, double the personal exemption taxpayers can claim and lower corporate tax rates, a USA Today analysis says.

Democrat Obama wants to reduce taxes for low- and middle-income families, while rolling back some tax cuts for the wealthiest U.S. taxpayers and increasing corporate tax rates.

Both candidates propose temporary tax cuts intended to help U.S. citizens cope with the financial crisis.

McCain wants to cut the capital gains rate in half, reduce the tax on retirement-savings withdrawals to 10 percent and waive a rule requiring senior citizens to start taking withdrawals from tax-deferred retirement savings at age 70 1/2.

Obama would permit savers to take penalty-free hardship withdrawals of up to $10,000 from their 401(k) and individual retirement accounts this year and next, the newspaper says.

Both candidates propose suspending taxes on unemployment benefits.

The non-partisan Tax Policy Center, a joint venture of Washington's Urban Institute and Brookings Institution, estimates Obama's tax package would add $3.5 trillion to the total federal budget deficit while McCain's would add $5 trillion.

The Congressional Budget Office estimates the nation's debt will swell to $2.3 trillion by 2018.