In the article Obama Tax Plan Would Ask More of Millionaires written by Jackie Calms was published in the New York Times back in September 2011 we learned that President Obama plans on taxing those who make more than one million a year pay a tax rate that will be close enough if not equal to the rate of taxes people who belong to the middle class. The idea of this proposal came from a billionaire known as Warren E. Buffett. The New York times article wrote that “the billionaire investor who has complained repeatedly that the richest Americans generally pay a smaller share of their income in federal taxes than do middle-income workers, because investment gains are taxed at a lower rate than wages.” This also leans towards the idea that the rich get richer while the poor stay poor. One of the reasons for Obama wanting to get “Buffett Rule” is because he believes it is fair for those making more money pay more taxes. Obama also believes that it’ll help our economy’s deficit begin to disappear.
A counter argument for this idea however is that there may be discouragement for people to invest. Or at least that’s what the Republican Party claims. In another article “Rebuffing Obama’s gimmicky ‘Buffett Rule’” written by Dana Milbank from the Washington Post from this year back in April also discusses some of the reasons as to how and why this plan may not work out well. In the article by Milbank wrote that “A search of the White House Web site yields 17,400 mentions of the Buffett Rule a proposal that would bring in $47 billion over 10 years, much of that from 22,000 wealthy households. By contrast, the alternative minimum tax gets fewer than 600 mentions on the site. The AMT, if not changed, will take about $1 trillion over a decade from millions of taxpayers, many of whom earn less than $200,000 a year.” He doesn’t believe the “Buffett Rule” makes much of a difference nor will it be good. Find out what the Obama’s “Buffett Rule” would do for you in the tax calculator link below.
Tax Calculator
The picture above is of Warren E. Buffett
I don't think ending preferential treatment for capital gains will be the boon everyone on the left seems to think it will be. For each extra dollar that the government collects, that means one less dollar for the investor to reinvest in another company/bond/T-bill. Thus, the country will gain a dollar of tax revenue and lose a corresponding dollar of business investment.
ReplyDeleteObama is clearly trying to protect middle class in many ways, including taxation. Whereas republicans are focused on lowering tax rates for the highest earners and proceeding with the aggresive capitalistic doctrine of supporting the rich people for them to invest money in the economy and, thus, help the middle class. This concept could have worked in the past but, in my opinion, proved to be a complete failure in the last 20-30 years. The middle class is a foundation for any society. So how come that the gap between the rich and the poor is growing so fast in the U.S., the middle class is disappearing and the republicans keep on pushing their old ways. I think that it is time to reevaluate the economic and taxation doctrines being used and come up with some milder options to make sure the middle class is not the one that suffers the most from the economic recession. Thus, Vice President, Joe Biden, in the VP debate clearly tried to use the taxation issue to appeal to the middle-class voters.
ReplyDeleteI think the only reason taxes on high income families have not been raised over the past few years is that America desperately needs major investmentsand restructuring. As President Obama mentioned during the second Presidential debate, millionaires paying around fifteen percent taxes won't help economy. It just makes them richer, and the poor even poorer.
ReplyDeleteRomney's tax plan, in my opinion, doesn't help the middle class, it's just a false promise. it will lower the tax percentage, but at the same time - cut the credits. In this case, the best thing that can happen to middle class, it won't win and won't loose. Worst - cut on the deductions will reduce the return, and people will loose money. First time homeowner's credit, for example, allows you to claim the interest paid on first few years of the mortgage. Considering that in the beginning almost all you pay is your interest, that's a way to go! There is no chance 20% lower tax rate can replace it! After loosing my financial aid, all I rely on is my tax credit. The American Opportunity Tax helps me to pay for college, and there is no way 20% lower tax rate can replace it! Romney also notes that he will still keep the 5% richest people in a 60% tax brake. BUT! He proposes no tax on investments and interest. Considering that the most money made by the richest people are through investments, it will do them a favor again!
The Buffett proposal seem like a reasonable way for President Obama to reduce the national deficit. Millionaires should share the same financial responsibilities as poor and middle class workers. I for example pay a whole week of my income in the form of taxes to the government each and every month that I work. It is my responsibility as an American to contribute to my country the money it needs to function and continue to grow. The President is right to ask the rich to share the same tax burdens that workers do. It's time for the 22,000 wealthiest households mentioned in the post to pay their fair share of taxes just like everyone else in America.
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