By John Palm, Editor
GCN Live.com
The White House and President Obama have been touting the “Buffett Rule” as the catalyst to raise taxes on the rich, but Warren Buffett’s comments seem to insinuate that something got lost in translation.
Warren Buffett
Courtesy Reuters
The “Buffett Rule” was created around wealthy businessman Warren Buffett’s assertion that he should be taxed equal to his lower-salaried employees. The rule says that no millionaire should pay a smaller tax rate than the middle-class.
GCN reported earlier this month that those who are millionaires and pay a smaller tax rate than middle-class people makeup a small portion of wealthy Americans.
Now, Warren Buffett, in an interview on CNBC, makes it clear that there are discrepancies between his ideal plan and the White House’s plan.
In the aforementioned article, GCN pointed out that many investors are taxed less due to lower tax rates on profits made from dividends and capital gains.
This concept is very similar to Buffett’s comments in the Friday morning interview.
“Somebody making $50 million a year playing baseball, his taxes won’t change. Make $50 million a year appearing on television, his income won’t change,” Buffett said regarding what his plan would look like. “But, if they make a lot of money and pay a very low tax rate, like me, it would be changed by a minimum tax that would only bring them up to what other people pay.”
Buffett continued: “My program is to have a tax on ultra-rich people who are paying very low tax rates. Not just all rich people. It would probably apply to 50,000 people in a population of 300 million.”
This appears to differ from the White House’s proposal on a couple levels.
First, Buffett does not claim that the rich do not pay “their fair share” – the line that has been said by President Obama and the White House. Buffett says those who are not paying the fair share are people “like me.”
Second, Buffett is concerned with the “ultra-rich” not paying their fair share. Obama’s new jobs plan is set to raise taxes in 2013 on families with a taxable income of $250,000 – not exactly the “ultra-rich.”
Throughout the interview, which can be seen below, Buffett avoids endorsing any plan President Obama has proposed.
It appears the comments that fueled the creation of the “Buffett Rule” were taken out of context and, to some, appear to be tax-raising propaganda.