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
    +1

    Comment number 119.

    @109 'scotw'. By public sector working less you include doctors, nurses, paramedics, police, firefighters I suppose?

  • rate this
    +2

    Comment number 118.

    And before most of the political horseplay starts, can both parties think back to the credit downgrade? A contributing factor perceived by the outside world was too much squabbling with little action too late.

    America - do you really want to be seen repeating unglorious recent history again?

  • rate this
    +1

    Comment number 117.

    93. benbowlane

    Without them you'd have nothing.

  • rate this
    -1

    Comment number 116.

    If you tax the rich, it will just trickle down to the poor. My bank that screwed up and has its rules changed is now charging fees when they didn't exist before. I'll get a new bank if I can.

    US government could make loads of money if they made it mandatory to charge sales tax on internet purchases

  • rate this
    +6

    Comment number 115.

    Local government cuts are hurting teachers, cops, garbage truck drivers, etc. Why is it so bad that the rich take even a little pain with the rest of us? I don't want to demonize the rich, but the right is happy to demonize public sector workers, and especially public school teachers. Maybe we need a moratorium on demonization from both sides.

  • rate this
    -1

    Comment number 114.

    didn't one of ours just read this in the daily mail and think "that'll be a good idea' ?

  • rate this
    +3

    Comment number 113.

    Obama is trying to do what should have been done long ago...tax the rich. The proposal that the rich are the job creators is plainly untrue. Thank you, Mr. Buffett, for your candor. Let's hope Obama gets reelected. Frontrunning Republicans are scary dumb and uninformed.

  • rate this
    +6

    Comment number 112.

    How do you collect taxes from people who are out of work? The idea is great to allow the wealthiest more money to invest...but the investment goes overseas. No taxes there. Obama seems to be trying to do the right thing to me, but he needs folks to back him up. I think I will vote for him the next election, and I don't usually vote.

  • rate this
    -1

    Comment number 111.

    money is just a theory, an act of faith. I am a hardworking poor American citizen that laughs at all this nonsense because when push comes to shove, money means absolutely nothing. if you are a greedy person rich or poor you have no spot at my dinner table. Real independence means freeing yourself from all shackles, including the US dollar.

  • rate this
    0

    Comment number 110.

    So the 'wealthy' will have to eat out less, employ fewer domestic staff, buy fewer cars, re-model their houses less often and take fewer vacations. Meaning even more unemployed people on welfare...

    Every individual should be taxed at 25% of their total income over a fixed sum ($15k or £10k for example) per year, without any exemptions.

    This is the only fair method.

  • rate this
    +2

    Comment number 109.

    This is a good move, the US is under-taxed.

    But what we all need is a simpler, fairer tax system, no loopholes or exceptions and none of the social engineering taxation that we had under Gordon Brown.

    But that doesn't mean massive taxation, especially when those in the private sector are expected to work to 68, while their public sector counterparts get paid more, work less and retire early.

  • rate this
    +11

    Comment number 108.

    Top 400 money earners in USA have more wealth than the total of the bottom 155 million USA citizens.Their wealth built on the toil of millions of US citizens, now the jobs are given to low cost countries, for what - a higher bottom line. The American dream should have a clause, you can become rich in the US but the work remains on US soil.

  • Comment number 107.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +1

    Comment number 106.

    The american who said i am rich and shouldnt pay more taxes ... that attitude may come to bite you , 50 million americans in poverty , your nation is bankrupt , your influence in the world has been overtaken by China , there is a real danger your country could go backward meaning more poverty which leads to unrest and fingers crossed COMMUNISM , oh please god make that happen , how i would laugh

  • rate this
    +2

    Comment number 105.

    We need a balanced solution to our deficits and a balanced solution to our jobs crisis. We have been cutting taxes for almost 10 years without any increase in average wages or increase in the number of jobs. We have also done stimulus programs in the last 3 years with marginal success. Neither approach can claim much success, in my view.
    Now, we are making massive cuts in local government.

  • rate this
    +2

    Comment number 104.

    I certainly wish the president luck, but the Republicans and the Koch Party (oops, I mean the Tea Party) have the public bamboozled into believing that they are overtaxed, and the richest the worst. Truth is, Americans pay the lowest taxes of any 1st world country, and taxes are the lowest they've been in 60 years. Doing away with the capital gains extension would be a good place to start.

  • rate this
    +3

    Comment number 103.

    If people, rich or poor, aren't paying their fair share then that should be corrected. I hope for the sake of the American people the bipartisan committee can iron out what is required without giving in to lobbyists from either side. Tax should be fair throughout the system.

  • rate this
    +8

    Comment number 102.

    I don't like Obama, never have, never will. But this is the right policy. For decades we've been lied to that taxing the rich less will see them invest more and the additional wealth will filter down to the less well off. Guess what, it's a LIE. Rich folks peddel the same old guff, it's known as vested interest. The smae applies in the UK

  • rate this
    +4

    Comment number 101.

    The rich gain the biggest rewards during boom times so should at least contribute the same tax, if not more, during more difficult times. And contrary to some peoples belief it is not just the rich that work hard, they would be nowhere without employees who can only earn an average wage.

  • rate this
    +8

    Comment number 100.

    Some people seem to believe that because the rich will now have to pay tax at the same rate as everybody else there will be less incentive to expend their business to make more money, and thus create jobs. Nonsense. They will still have the ability to make money they'll just be contibuting their fair share.

 

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