President Obama has yet to release details of the so-called “Buffett Rule” he plans to introduce Monday, but Republicans already say they aren’t buying it, calling it “class warfare.”
Obama will try to make billionaire Warren Buffett’s name part of the United States tax law. The White House confirms to ABC News that as part of a speech on long-term deficit reduction, the president will propose a “millionaire’s tax.”
“The Buffett Rule” would require any American making more than a million dollars a year to pay at least the middle class tax rate. Buffett, one of the richest men in the world who is known as the “Oracle of Omaha,” has for years declared that the rich need to pay more in taxes.
“I think that people at the high end — people like myself — should be paying a lot more in taxes,” he told ABC News in November 2010. Recently Buffett wrote in an opinion piece that the country “should stop coddling billionaires.”
The president has been seizing on that position to bolster his argument that the rich need to pay more.
“Warren Buffett pays a lower tax rate than his secretary — an outrage he has asked us to fix,” the president told a joint session of Congress earlier this month when he revealed his American Jobs Act.
Here is how the President’s plan might work using Buffett as an example. A few years ago, Buffett said his secretary made $60,000 and paid 29 percent in taxes. The billionaire made $46 million but only paid 17 percent in taxes, about $8 million. Under the millionaire tax, if Buffett paid that middle class rate of 29 percent, he would owe another $5.5 million in taxes.
Republicans rejected and mocked Buffet’s argument.
“If he’s feeling guilty about it I think he should send in a check … But we don’t want to stagnate this economy by raising taxes,” Senate Minority Leader Mitch McConnell said today on NBC’s “Meet the Press.”
“The Buffet Rule” will be just part of long-term deficit reduction and tax reform plan the president will propose in a speech Monday, the White House said. Obama has long contended that the rich need to contribute more. It is a populist plan and polls have found it has general support among Americans.
Republicans, however, call it divisive.
“Class warfare will simply divide this country more. It will attack job creators, divide people and it doesn’t grow the economy,” Rep. Paul Ryan said on FOX News Sunday. “Class warfare may make for really good politics, but it makes for rotten economics.”
But Obama received some support from fellow Democrats.
“If you look at the group that has had the biggest income increases and the benefit of most of the tax cuts of the previous eight years before the Obama administration took office, those of us in that income group, we’re in the best position to make a contribution to changing the debt structure of the country,” former President Bill Clinton said on CBS’ “Face the Nation.”
Sen. Richard Durbin, D-Ill., said on CNN’s “State of the Union,” that he thinks the plan is a good one, and argues that the Republicans’ alternative is just “do nothing and protect the millionaires.”
In his pitch Monday, the president will not be specific in terms of rates, but officials estimate such a “millionaires’ tax” would affect fewer than 450,000, or .03 percent, of taxpayers.