President Obama on Monday will propose a special “millionaire’s tax” that he will call the “Buffett Rule,” Obama administration officials told ABC News.
The president’s pitch will come in the context of his remarks about deficit reduction. He will not be specific in terms of rates, but officials said such a tax would affect fewer than 450,000 taxpayers, or 0.3 percent. The proposal was first reported by Jackie Calmes of the New York Times earlier tonight. The proposal is to make sure that millionaires pay at least the same tax rate as those in lower brackets, officials said, an issue billionaire investor Warren Buffett recently raised by noting he pays a lower tax rate — 17.4% — than his employees, whp average a 36% rate.
Faced with a Congress that opposes many of the suggestions he has made for job growth and deficit reduction, the president is increasingly making proposals that seem designed to garner popular, even populist, support — Republicans call it “class warfare” — so as to draw contrasts with Republicans for election 2012. But the public’s lack of confidence in his handling of the economy could undermine his ability to push his measures, however well they poll, through Congress.
The president’s proposal will generally be based on the notion put forward in an August New York Times op-ed by billionaire investor Warren Buffett called “Stop Coddling the Super-Rich,” officials said.
Buffett specifically suggested that the so-called “Super-committee” required to come up with $1.5 trillion in deficit reduction should “leave rates for 99.7 percent of taxpayers unchanged… But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate. My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.”
The president in his tour of the Midwest last month embraced Buffett’s call as his own.
“Warren Buffett had an op-ed that he wrote today, where he said, ‘We’ve got to stop coddling billionaires like me,’” the president said in Cannon Falls, Minn. “The point is, is that if we’re willing to do something in a balanced way — making some tough choices in terms of spending cuts, but also raising some revenue from folks who’ve done very well, even in a tough economy — then we can get control of our debt and deficit and we can start still investing in things like education and basic research and infrastructure that are going to make sure that our future is bright. It’s not that complicated, but it does require everybody being willing to make some compromises.”
Republicans have said they are not willing to raise taxes at this time of economic instability, particularly on the wealthy, since they say it would hinder job creation and investment.
– Jake Tapper