Larry Kudlow

A federal budget deal to avoid the fiscal cliff can be achieved without

raising tax rates, Senate Minority Whip Jon Kyl said Friday on the Kudlow

Report.

“Tax revenues can be generated by two ways other than raising tax rates,” he said. “One is to eliminate some of the deductions, credits, exemptions, special provisions in the code that end up producing more revenue but without affecting the rates. And the other is through economic growth.”

The senator from Arizona said he thought it likely a deal could be struck to avoid the so-called “fiscal cliff,” a deadline by which the lack of a federal budget would result in the expiration of the Bush tax cuts and trigger automatic spending cuts.

Kyl sees additional revenues as the key.

“If we can focus, not on tax rates, but to give the president something that he wants, more tax revenues, as I said, there are ways to get more tax revenues,” he said. “Either through and/or producing more wealth as a country, thus resulting in more taxes paid to the government.”


Larry Kudlow

Lawrence Kudlow is host of CNBC’s “The Kudlow Report,” which airs nightly from 7 p.m. to 8 p.m.