Buffett Rule Facts and Fictions

[admin]

Buffett Rule Facts and Fictions
Posted by Gene Sperling on September 21, 2011 at 4:28 PM EDT

On Monday, the President proposed the Buffett Rule as one of five principles for comprehensive tax reform. This is a rule of simple fairness—no household making over $1 million annually should pay less in federal taxes than middle-class families pay. Contrary to some misconceptions, the Buffett Rule is not designed as the sole or main source of raising new revenues, but one of five principles that should be achieved by tax reform:

1.Cut rates
2.Cut inefficient and unfair tax breaks
3.Cut the deficit by $1.5 trillion over 10 years
4.Increase investment and growth in the United States
5.Observe the “Buffett rule.”


Of these principles — all of which we believe are key to reform — the Buffett rule has received the most attention. It has been attacked with claims of “class warfare” that are completely without merit. How can it be class warfare to ensure that there is greater parity between the taxes paid by the most well-off and those paid by tens of millions of hardworking families? Still, since not all of the reports about the Buffett Rule have been accurate, I want to clarify what we mean – and why the President believes this is an important principle.So let’s look at what this rule is and is not:

Claim: This rule would raise taxes while the economy is weak.

Fact: The President’s plan does not raise anyone’s taxes in 2011 or 2012. The President believes that the most well-off Americans should contribute to deficit reduction by paying more, but under the President’s plan, all measures to raise additional revenue — including fundamental tax reform — are effective starting in 2013.

In fact, the American Jobs Act calls for $245 billion in immediate tax relief, providing a tax cut for both workers and small businesses in 2012 by cutting the payroll taxes that both pay. This builds on the President’s record of cutting taxes for the middle class and small business.

http://www.whitehouse.gov/blog/2011/09/ ... d-fictions