Obama and Buffett.
President Obama and Warren Buffett seem to be joined at the hip. Buffett is the de-facto spokesman for Obama on matters of business and economics.
The familiar scenario of tax fairness was unleashed in 1969 by the passage of the AMT. The tax was passed to take care of the 21 millionaires who paid no income tax in 1967. Now the AMT affects some 4 million taxpayers. Obama and Buffett want people who make more than one million dollars to pay a higher tax rate than middle-class earners. The Buffett strategy is ill conceived since the latest data in 2008 and the IRS stats show that those who made more than one million dollars in adjusted gross income paid an average income tax rate of 23.3%. That is close to the 24.1% paid by those making between $500,000 and $1,000,000 due to the fact that the very rich like Buffett earn more from capital gains and dividends. Nearly all of the millionaires still paid a rate that is more than twice the 8.9% average rate paid by those earning between $50,000 and $100,000 and more than three times the 7.2% average paid by those earning less than $50,000. Even if Obama/Buffett taxed every billionaire at a 100% rate, it still would not make a dent in the federal deficit.The above tax information was obtained from the Sept 2 edition of the Wall Street Journal. As opposed to Obama”s theory that if we raise taxes, the economy will grow. Hard to believe that our government actually believes this fantasy. Encourage businesses to invest in the U.S. , cut the capital gains tax and allow companies too repatriate their money and reduce the corporate tax. In conclusion, the top 1% of income tax payers pay 40% of all income taxes and that 50% of of income tax filers pay no tax at all. Also the evidence is clear that lowering the capital gains tax increases revenues, ---remember the Laffer Curve that I have discussed in prior blogs.
Gary E. Marsella