US economy: New Obama plan to tax wealthiest

 
President Barack Obama - 16 September 2011 President Barack Obama faces an election year with unemployment stubbornly high

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US President Barack Obama is planning a higher minimum tax rate on the richest Americans to ensure they are taxed at the same rate as the less wealthy.

White House officials said Mr Obama would provide details of his proposal on Monday when he reveals his long-term plan to reduce the budget deficit.

Reports say the proposal is to be called the Buffett Rule, after the billionaire investor Warren Buffett.

Mr Buffett says loopholes mean the richest pay relatively less tax.

This is because earnings from investments are taxed at lower rates than wages.

The proposed new tax would affect Americans who earn more than $1m a year.

The proposal is likely to meet a strong challenge in Congress, where Republicans have said they oppose any tax increases.

The US economy has been growing only slowly while the unemployment rate remains stubbornly high, above 9%. Facing an election next year, Mr Obama has had a battle in Congress over how to reduce the ballooning deficit while the economy remains stagnant.

A Congressional "supercommittee" of six Republicans and six Democrats has been charged with finding steep reductions in the deficit by late November, when automatic cuts come into force.

 

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  • rate this
    0

    Comment number 99.

    Most of these big business tycoons have fingers in every pie, and as we know today most of these pies have made losses. If you increase the tax burden on these guys, then the tax offset against these losses is greater.
    Do I trust politicians - not 1 iota.

  • rate this
    +2

    Comment number 98.

    There seems to be this illusion that rich people create wealth. If the investment is put into the manufacture of goods then yes value is added to the economy. As for investment into financial services (stocks, futures, derivatives etc) no wealth is added. A stock is only valuable till someone pays for it and that money had to come from somewhere. It is a zero sum game. Someone wins someone loses.

  • rate this
    +7

    Comment number 97.

    Tax loopholes are similar to those in UK. Tax lawyers will be happy?

    Being rich doesn't mean you work hard.
    Being poorer doesn't mean you don't work hard.

    Balance/fairness is all the majority of working people want. Take low paid workers out of tax so they can meet bills, save & spend to boost economy.

    Point never mentioned. So much is made overseas. Job losses. More welfare and less dignity?

  • rate this
    +1

    Comment number 96.

    Obama inherited a message up economy from the past few presidencies. As a black man in the WHITE house, he is fighting an uphill battle. He has to deal with the good old boys on the hill that dont like this younger, black upstart.

  • rate this
    +5

    Comment number 95.

    You know, people keep saying the Obama is failing at this, failing at that, this plan sucks, that plan sucks. No matter he does, individuals keep complaining. At the same time, those individuals do nothing to improve the situation. "Oh the next president will be better". Yeah and you know what will happen then, people will complain and moan about him. Obama inherited a messed up economy.

  • rate this
    +4

    Comment number 94.

    One of the few topics in American politics on which the BBC and the community here can't stay very neutral, seeing as how the U.S. people are the only ones here arguing for lower taxes for everybody--especially the rich--even though we're losing jobs and economic strength to countries like Germany that have very strict regulation and high taxes...

  • rate this
    -3

    Comment number 93.

    I start a company employ 5 people. They work 8hrs a day 5 days a week, 21 days a holiday a year. I work 14 hrs a day 7 days a week no holidays. The company succeeds. I employ another 5 people They also do 8hrs a day 5 days a week 21 days holiday a year. I do 16 hrs a day 7 days a week,1 weeks holiday a year. 5 years on I employ 32 people all earning a ldecent iving.Why shouldn't I enjoy my wealth.

  • Comment number 92.

    All this user's posts have been removed.Why?

  • rate this
    +1

    Comment number 91.

    Ensuring that loopholes are closed so the rich pay the same effective rates as others is sensible economically AND politically. ALL income should be taxed at the same rate. A reduced rate on"capital gains" should apply ONLY when whatever is being sold has been owned for a minimum of 10 years; house, stocks, art, etc.
    Friedman and Rand were wrong, their acolytes even more so.

  • rate this
    +5

    Comment number 90.

    @71.Luke Jordan

    Last year a CEO of a big corporation earned $101 million. The median wage in the USA is $46,326, so are you telling me that the CEO is worth 2195 average workers? Lets put that to the test. Remove the CEO and what effect would that have on the company? Now remove 2195 of its workers and see the effect that would have. It`s the workers that produce the wealth, be grateful.

  • rate this
    +1

    Comment number 89.

    I think Obama is right to try and bring CGT in line with income tax but I know he doesnt have the control of the houses needed to implement it. Lets face it, the Republicans will never allow it; they stated that quite clearly when the US was closing in on its debt ceiling. It's a shame most rich people dont think like Warren Buffet or Liliane Bettencourt.

  • rate this
    +2

    Comment number 88.

    The amount of money you earn is not in relation to how hard you work.

    Some one doing two or three cleaning job and earning the absolutely minimum wage will pay a higher percentage of their wage in tax than some earning considerably more.

    The more you earn the higher the percentage you pay in tax.Just like the old days.Where all were happy with the tax system.

  • rate this
    +6

    Comment number 87.

    All he needs do is implement a similar "cure" as suggested for the UK.
    Increase the tax threshold so that low wage earners pay little or nothing.
    Simplify the tax system to remove loopholes.
    Impose/enforce a common tax rate of around 25-35%.
    Make corporations pay their corporation and business taxes.
    Abolish property taxes so that people aren't made homeless.
    Too socialist for the UK/USA?

  • rate this
    +2

    Comment number 86.

    What I want to see are sanctions against tax havens , why has this never happened before ? Billions are held in Swiss , Cayman Island etc bank accounts and much of this money is untaxed why else should it be there , right ? yet we all trade with Switzerland that has this unique status sat in the centre of Europe . I expected after 2008 more steps to bring in taxes on income squirreled overseas .

  • rate this
    -1

    Comment number 85.

    The same the all over the world.There is only need for increase taxes if governments of all colors continue to SPEND try cutting leaving us to spend our own money.

  • rate this
    +7

    Comment number 84.

    It seams to me Rebulicans care more about the dollar more than fellow Americans.
    They would happily see their country destroyed if they could have just one cent more.
    How is it Americans (most of whom are the ones rebulicans would happily see starve) are happy to ever elect such people to power.
    I will never understand Americans as most are such warm generous people but the rich so selfish.

  • rate this
    -1

    Comment number 83.

    Comment 39 by Paul seems a bit off. I thought Obama's stimulus did help the construction workers industry. Besides that, I believe that while it may be a good idea, and wealthy tax payers may not object too much, it will just cause more grid lock between the two parties, resulting in more inactivity by the the nations' small businesses.

  • rate this
    +1

    Comment number 82.

    For those comparing the UK with the US , well the two are very different . In a survey in the US the majority supported the low taxes on the rich , that would never happen in the UK , they have the illusion of ' the american dream ' . In the UK the tax rates are much higher on the wealthy than in the US .

  • rate this
    +2

    Comment number 81.

    This will mean war, the rich will not support anyone who messes with their Right not to be able to use as many loop holes as possible, to pay, as little tax as they can. In order to enjoy a life style of living, so unimaginable to the real tax payers, who bleed , footing the bill, on meager incomes, and a higher tax, with no loop holes for them to hide in. Corporations only want cheap labor,people

  • rate this
    +6

    Comment number 80.

    71.Luke Jordan
    you need a dose of reality the wealthy don't create jobs they only create the opportunity its society paying for products and services that funds and creates the job.
    wealthy business owners/directors just take their cut from the work of others and frequently for doing far less than less well paid employees do

    no customers no jobs no matter how wealthy a business owner is

 

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