ABC World News: The Buffet Rule. The Mega-Rich Should Pay The Same Tax Rate As The Rest Of Us!

The Buffet Rule. The Mega-rich Should Pay The Same TaxesSep 18, 2011 – ABC World News with Diane Sawyer recently reported that billionaire investor Warren Buffet says it’s time for the mega-rich to pay at least the same tax rate as their employees!  Buffet asks, “Should he pay a smaller percentage of tax than his own secretary?” ABC’s Bianna Golodryga reports that Warren Buffet took aim at the nation’s tax system saying that his $45 billion fortune bought him access to an elite club that doesn’t pay their fair share of taxes!

He says that while most Americans struggle to make ends meet, the mega-rich continue to get extraordinary tax breaks. He says “my friends and I have been coddled long enough!”  Bianna reports that Buffet has long been passionate about this subject.  He thinks that our tax system is not very equitable. He thinks it has drifted dramatically in the last tens years to favor rich guys like him.  So he pays a lower tax rate on much of his income than his cleaning lady does and he thinks that is crazy!

How crazy?  Well last year, Bianna reports that Buffet paid $7 million dollars in taxes. That might sound like a lot but it works out to a tax rate of just 17%. Buffet points out that his employees pay about double that rate. He says his secretaries and receptionists pay a 33% rate.

Why is his rate so low? Bianna reports that much of Buffet’s income come from capital gains, profits coming from investments. They are taxed at only 15%.

Bianna Golodryga says Buffet’s solution is that tax rates should be raised for those 300,000 Americans who make more than $1 million a year.  Everyone else in America should be left alone!   Just an additional 1% tax on the richest Americans is estimated to raise $100 billion dollars in extra revenue during the next decade.

But Bianna reports that tax experts say it is not enough for just the super rich to pay more.  Maya MacGuineas, President for The Committee for a Responsible Federal Budget says “The bottom line is that the fiscal hole that we face is so large that everybody has to be prepared to pay more in revenues in the end”

Bianna says that while experts agree that $100 billion over the next decade would not be enough to even make a dent in the deficit, it would go far in other ways.  For example it is enough to build over 7000 new elementary schools or more than 2000 new high schools.

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