As Barack Obama landed in Washington from his home town Chicago, the US media reported that the President-elect plans to announce a massive tax cut for the middle class and business.

Obama's proposed tax cut for the middle class and business could amount between $270 billion and $310 billion, as the President-elect plans to ask the Congress for a stimulus package of $675 billion to $775 billion.

In all it would be about 40 per cent of his stimulus package.

These tax cuts are targeted at generating jobs in the private sector and help middle class families, officials from Obama Transition Team said.

"We're working with Congress to develop a tax-cut package based on a simple principle: What will have the biggest and most immediate impact on creating private-sector jobs and strengthening the middle class?" transition-team spokeswoman Stephanie Cutter was quoted as saying by The Wall Street Journal.

"We're guided by what works, not by any ideology or special interests," she said.

For families, the tax cuts include the $500 "Making Work Pay" payroll tax credit Obama proposed during the campaign, Washington-based Politico.com reported.

For businesses, the tax cuts would include breaks for small employers and a "new jobs credit", it said.