President Obama To Propose New Minimum Tax Rate for Millionaires

According to the New York Times, President Obama will "call for a new minimum tax rate for individuals making more than $1 million a year to ensure that they pay at least the same percentage of their earnings as middle-income taxpayers".

The proposal, which will be officially unveiled on Monday, will reportedly be called the "Buffett Rule". As you can probably guess, the "Buffett" in "Buffett Rule" refers to Warren Buffett, CEO of Berkshire Hathaway and one of the greatest investors who has ever lived.

Buffett made waves earlier in the summer when he said that he and his "megarich" friends were being "coddled" by a "billionaire-friendly" Congress. Buffett contends that the tax code should be altered so that "rich" Americans "share in the sacrifice".

The Joint Committee on Deficit Reduction has been meeting in private over the past little while, hoping to come to an agreement on how the country will cut $1.5 trillion from its deficit over the next ten years. Both sides are considering any number of different options that would produce the required deficit reduction over the next decade. Democrats are hoping that revenue increases (through tax increases and the elimination of some tax breaks) are a big part of the deficit reduction plan, while Republicans maintain that deficit reduction should come in the form of spending cuts, and that tax increases should be avoided at all costs.

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There is basically zero chance that the "Buffett Rule" becomes law, especially with so many Republicans having signed the "Taxpayer Protection Pledge".

The Republicans staunchly maintain that raising taxes on the wealthy will result in the loss of jobs, as the top income earners in the country are the "job creators".

There is no reason to think that the Republicans will suddenly flip and agree to the proposed "Buffett Rule" at this point.

Obama will undoubtedly use the Republicans' near-certain opposition of the "Buffett Rule" as political ammunition in 2012.

Source: NYTimes.com - Obama Tax Plan Would Ask More of Millionaires

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