WASHINGTON — Republican-led opposition blocked the “Buffett rule” from advancing in the Senate, turning back an election year effort by President Barack Obama to slap a new tax rate on those earning beyond $1 million a year.
Nearly all Republicans voted against the measure, a potentially risky move at a time when 60 percent of voters support the measure, according to a recent Gallup poll, as a way to ensure wealthy Americans pay their fair share of taxes. Democrats are likely to revive the effort in coming months.
“Continuing to allow some of the wealthiest Americans to use special tax breaks to avoid paying their fair share simply cannot be justified,” the White House said in a statement before the vote.
But Republicans stood firm in their opposition, calling the measure a “gimmick” that was more about blaming the wealthy than reining in government spending and deficits.
The Senate voted 51-45, mostly along party lines. The measure needed 60 votes to advance. One Republican, Sen. Susan Collins of Maine, joined Democrats in voting to advance the measure. One Democrat, Sen. Mark Pryor of Arkansas, voted against.
“Most people have heard enough about this president’s notion of fairness,” said Sen. Mitch McConnell of Kentucky, the Republican leader. “To most people, what’s fair about America is that they can earn their success and expect to be rewarded for it.”
Named for Warren Buffett, the billionaire investor who has said he should not enjoy a lower tax rate than his secretary, the Buffett rule would impose a minimum 30 percent tax rate on annual incomes beyond $1 million. The top income tax rate is now 35 percent, but many wealthy households pay less because of deductions and lower rates for income that comes from investments rather than earnings.
GOP presidential contender Mitt Romney paid an effective 14 percent rate in 2010, and has said he expects to pay about 15 percent for 2011.
©2012 Tribune Co.
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What rule is that don’t pay your taxes like Warren Buffett?
Like the banner says on the BDN “The circus is coming to town!”
Thanks Susan.
This was actually just a vote to bring this to a vote or, to end the filibuster. The majority voted to support this common sense and popular issue but not the 60% needed to break the filibuster. The problem is we the people electing Grover Norquists pawns. Surprisingly, Collins broke with her party and voted for this proposal. Kudos to our Junior(soon to be senior) senator for that.
If Senate Democrats required a real filibuster, the 60 votes would not be needed very often.
The Buffett Rule doesn’t affect the tax rates of salaried income; it only punishes those who have invested thousands upon thousands of their own dollars into the economy. Sounds like their already paid their fair share when they helped lift small businesses of the ground and pay the salaries of others. An absolute attack on capitalism, as customary with this President.
Or exported jobs …
An unfortunate reality when our corporate tax rate is the HIGHEST in the world…
I don’t care for taxes. No one that I know likes them, but as a society we have a system to decide what programs the government will support and historically we have paid for those via taxes or issuing savings or treasury bonds.
A more recent event is “borrowing and spending”. The Republicans love to make this about Democrats, but the fact is that under George W Bush, with a Republican congress, they frittered away a surplus created under Bill Clinton, by cutting taxes, waging two wars that we did not pay for, simply fired up the printing press, passed the largest social program expansion since LBJ was in the Oval Office (Medicare expansion), and formed another large government agency that did not exist (TSA).
Yet they scream bloody murder about the Dems taxing and spending and being the party of big government. The George Bush years tell a different story. I would urge those who are critical of the Dems, and lord knows there is a lot to be desired there, to look at the Republican party and judge them by what they have done and not what they say.
You’ve gone way off topic with this debate. The Buffett rule is not an attempt to reduce the deficit by any means. It will affect only 0.001% of American taxpayers. The rule is purely symbolic. It’s not a solution to anything. It is simply an attempt to punish and discourage investors.
Actually, it’s not off topic. Under Clinton the Capital Gains rate was 20% and we had the greatest economic expansion in US History. I would agree that the Buffet rule is insignificant in its revenue. The greatest danger to the US economy is the rapid shift in the concentration of wealth in our county, which has been going on for 30 years. There is a great article on this in the NY Times, which will automatically be ridiculed by the right wing as “class warfare” and socialism.
As a society, if we want programs or wars or service, we should pay for them. If you want to cut taxes, lets eliminate Social Security and Medicare, and folks can fend for themselves. It was that way up until 1935 for Social Security and until 1965 for Medicare. These are the two biggest welfare programs.
By Republican logic, the elimination of this tax (6% for SS 1.45% for Medicare, plus the employer match of 7.45% would free up 14.9% of total income in the country (up to 107,000 per person), and the economy will soar. A rising tide lifts all ship and these elderly leaches will be empowered to be self sufficient!!!!
They need to step up and become patriots. Get left a bundle, invest it and pay less taxes than the lawn boy. The investors are free to love this country an pay the same tax rate I do.
In the coming months, I am going to just keep re-posting this article as a reminder……
Sen Collins: you go girl! Wise move.
Senate Republicans/Tea Party says NO-NO-NO we can’t have this. They know who butters THEIR toast. The GOP/Tea Party has been telling us all along that it’s the millionaires who are the “Job Creators.” See how many jobs they created after 10 years of receiving the “Bush Tax Breaks?” See em? Don’t ya see em? Oh well just keep looking. Thank goodness we now have prosperity for all…for all those millionaires that is. They’re rolling in excess cash the same way China is rolling in job opportunities they’ve been given over those same 10 years by the folks with the tax breaks. Looks like the “Job Creators” are more like “Nation Destroyers” (U.S.).
It’s quite obvious that our government is actually the ones rolling in cash. I prefer that we stop them from blowing the money that we are sending them before we start sending them even more. As for the name of this rule they should rename it the Obama rule before they try to vote on it again since he isn’t giving his “fair share” either.
It is because of bills like this that a majority of people believe that the wealthy pay hardly any taxes at all, which is simply not true. Buffett is comparing his capital gains rate with his secretaries income tax rate, he might as well be comparing what he pays on sales tax. They are two very different taxes.
If you want the wealthy to pay a minimum tax on their earnings, regardless of where they come from, then you have to eliminate corporate taxes and tax capital gains as income. I understand that many have a hard time understanding the notion that capital gains from dividends are already taxed which is why the capital gains rate is so low, to avoid excessive double taxation. But let me explain it this way, imagine you own a store and that store is incorporated, now imagine your store has an earnings pre-tax of $1 Million and that you have no annual salary and thus you receive your earnings from dividends. Now, before you can pay yourself you have to pay the taxes on that $1 Million which we will say is 40%. Now that you have paid your taxes, you will pay the rest to yourself in the form of dividends. Now that you have paid yourself the remaining $600,000 you will pay a capital gains tax of 15%. Which leaves you with $510,000. And while that is a good deal of money, that is not the point, the point is that the effective rate on that money is 51% therefore making the tax rate that appears to be a low 15% much higher. And granted it isn’t as “cut and dry” as the example provided, it is meant to serve as a simple example to convey my message.
While I am not going to argue the effects of the Bush Tax Cuts, you cannot state that we did not have prosperity in the past decade. Granted we are currently in a recession, but that is part of the natural business cycle and has nothing to do with tax cuts. Since you are a big Keynesian person, the entire purpose of Keynesian economics is to eliminate recessions, clearly that is not working.
Also, it should be noted that the Bush tax cuts affect nearly everybody, once they expire expect your tax bill to increase by a fairly good amount. Although I am sure you did not realize that because the media will have you believe the Bush tax cuts are only for the wealthy, which is not true.
And finally, your ideas of “cash” is totally wrong. You have this idea that all these evil rich people are getting their big paychecks, cashing them and stuffing their money under their mattress. That is not true, rich people put their money to work. They do so by investing it, I know you don’t like to hear that, but facts are facts. They invest their money to a) make more money and b) at the very minimum combat inflation. It should also be noted that once they “trade” their money for whatever the investment may be they no longer have that money, instead they traded that money for another form of “wealth”, usually a non-physical piece of wealth that uses no labor, and no resources of any kind. So their money is back in the wild, and they haven’t “taken” anybody elses wealth. Your notions of money and wealth, like most fiscal liberals is very out of touch with reality.
Long windy argument signifying nothing. They need to pay the same rate as everyone else.
So you want them to pay less? Their income tax rate is higher. Otherwise, capital gains rates are flat, so they do pay the same rate. So not sure why you said that….
Right here in Maine governor LePage created two jobs, both for relatives. Don’t say the tax breaks don’t work.
This is a good example of why the tax code should be thrown out. It is fair to no one.
BTW, Buffett’s companies owe nearly one billion dollars in back taxes and penalties which they are protesting. Talk about gall.
What did anyone expect ? The Conservatives to vote “yes” on something that the vast majority of Americans were in approval of ? Representatives ? What a joke !!!