President Obama said in his weekly address Saturday that Congress will be voting in the weeks ahead on the Buffett Rule, which would raise taxes on the wealthy.
“In the next few weeks, members of Congress will get a chance to show you where they stand,” said Obama. “Congress is going to vote on what’s called the Buffett Rule: If you make more than $1 million a year, you should pay at least the same percentage of your income in taxes as middle class families do. On the other hand, if you make under $250,000 a year – like 98 percent of American families do – your taxes shouldn’t go up. You’re the ones struggling with the rising cost of everything from college tuition to groceries. You’re the ones who deserve a break.”
Obama has been pushing for the Buffett Rule, named after his friend, billionaire investor Warren Buffett, who wrote a New York Times editorial last year in which he claimed that the Tax Code coddles the super rich, and that they should not be paying a lower effective tax rate than their secretaries. The Buffett Rule, which Obama also described during his State of the Union address in January and included in the administration’s fiscal 2013 budget, would effectively set a minimum tax on millionaires and billionaires.
“Over the last decade, we’ve spent hundreds of billions of dollars on what was supposed to be a temporary tax cut for the wealthiest 2 percent of Americans,” said Obama. “Now we’re scheduled to spend almost a trillion more. Today, the wealthiest Americans are paying taxes at one of the lowest rates in 50 years. Warren Buffett is paying a lower rate than his secretary. Meanwhile, over the last 30 years, the tax rates for middle-class families have barely budged.”
Obama rejected accusations that his proposal should be considered “class warfare.”
“Now, some people call this class warfare,” he said. “But I think asking a billionaire to pay at least the same tax rate as his secretary is just common sense. We don’t envy success in this country. We aspire to it. But we also believe that anyone who does well for themselves should do their fair share in return, so that more people have the opportunity to get ahead—not just a few.”
House Republicans passed an alternative to the Obama administration’s budget on Thursday, which would actually cut the top tax rate on individuals and corporations from a maximum of 35 percent to 25 percent, and collapse the tax brackets into just two brackets of 10 and 25 percent (see House Passes Paul Ryan Budget, Consolidating Tax Brackets). However, the House GOP budget, which was based on a plan by House Budget Committee Chairman Paul Ryan, R-Wis., is not expected to get far in the Democratic-controlled Senate. A similar budget was passed last year in the House, but failed to make headway in the Senate.
Obama vowed that the Buffett Rule would come up for a vote in Congress. Sen. Sheldon Whitehouse, D-R.I., has introduced a bill that would implement the Buffett Rule (see Senator Introduces ‘Buffett Rule’ Tax Reform Bill).
“Every member of Congress is going to go on record,” he said. “And if they vote to keep giving tax breaks to people like me—tax breaks our country can’t afford—then they’re going to have to explain to you where that money comes from. Either it’s going to add to our deficit, or it’s going to come out of your pocket. Seniors will have to pay more for their Medicare benefits. Students will see their interest rates go up at a time when they can’t afford it. Families who are scraping by will have to do more because the richest Americans are doing less. That’s not right. That’s not who we are.”
Obama urged voters to contact members of Congress to approve the Buffett Rule. “Tell your members of Congress to do the right thing,” he said. “Call them up, write them a letter, pay them a visit, and tell them to stop giving tax breaks to people who don’t need them and start investing in the things that will help our economy grow and put people back to work. That’s how we’ll make this country a little fairer, a little more just, and a whole lot stronger.”
In the Republican response to Obama's address, Speaker of the House John Boehner, R-Ohio, urged Senate passage of Republican-sponsored energy legislation to combat rising gas prices. "The Senate has stalled dozens of House-passed bills, several of which would implement the Republicans' 'all-of-the-above' energy strategy to address rising gas prices and help create jobs," said Boehner. "All of these energy bills passed with bipartisan support. Many are backed by the President's own Jobs Council. I'm challenging President Obama to make good on his rhetoric and urge the Senate to allow a vote on bipartisan, House-passed energy bills."
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