Senate Rejects President Obama’s ‘Buffett Rule’ on Taxes
The Senate rejected the “Buffett Rule,” which would’ve raised the tax rates for millionaires, after Republicans accused President Barack Obama of pitting Americans against each other.
Democrats argued that it was time for the tax code to treat the wealthy and the middle class fairly, but were unable to get enough votes to have the rule clear the Senate. The vote was mostly along party lines.
A day before Americans’ taxes were due at the Internal Revenue Service, the partisan clash previewed themes that will echo throughout this year’s presidential and congressional election campaigns. But while the two parties competed for the stronger message to voters, one thing was sure — Republicans had enough votes to derail the Democratic bill.
As debate began, Senate Majority Leader Harry Reid, D-Nev., said the gap between the wealthiest Americans and everyone else had grown into a gulf.
“They shouldn’t be allowed to hide behind tax loopholes that rig the system in their favor,” Reid said.
But Senate Minority Leader Mitch McConnell, R-Ky., said the legislation would do virtually nothing to fix the economy or stem the federal budget’s massive deficits, and was an attempt by Obama and his fellow Democrats to mask those problems.
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“The problem is, we’ve got a president who seems more interested in pitting people against each other than he is in actually doing what it takes to face these challenges head-on and to solve them in a bipartisan manner,” McConnell said.
The “Buffett Rule” bill, sponsored by Sen. Sheldon Whitehouse, D-R.I., would have slapped a minimum 30 percent income tax on people making over $2 million yearly and phased in higher taxes for those earning at least $1 million. The measure was nicknamed for billionaire Warren Buffett, who backed higher taxes on the rich.
Democrats said the Buffett rule vote underscored their commitment to economic fairness and GOP favoritism for the rich, a prominent election theme. Hammering at it let Obama shine a spotlight on presumed GOP presidential nominee Mitt Romney, a former private equity executive who has paid an income tax rate of about 15 percent on annual earnings of $21 million,. The rate is a lower rate than many middle-class families pay.
The Buffett rule was clearly popular. An Associated Press-GfK poll in February showed that nearly 2 in 3 favored a 30 percent tax for those making $1 million annually, including most Democrats and independents and even 4 in 10 Republicans.
Yet the measure would have raised just $47 billion over a decade, a smidgen of the $7 trillion in federal deficits expected during that time.