Obama to introduce 'Buffett Tax' for the rich
Barack Obama is to propose a "Buffett Tax" on rich Americans, citing the investor Warren Buffett's plea last month that he should pay more tax.
The proposal, due to be announced today, that people making more than $1m (€726,000) a year should face a new tax is one of the US president's recommendations to a congressional "super committee" seeking long-term national debt reductions.
In his speech to a joint session of Congress on September 8, Mr Obama said: "Right now, Warren Buffett pays a lower tax rate than his secretary -- an outrage he has asked us to fix. We need a tax code where everyone gets a fair shake, and everybody pays their fair share."
Mr Buffett, who donated money to Mr Obama in 2008 and endorsed him for president, was ranked as the third wealthiest person in the world last year, behind Carlos Slim Helu and Bill Gates. In 2008, he was ranked the wealthiest.
Republicans were quick to criticise the proposal, branding it "class warfare" and predicting it would be rejected by Congress, where Democrats control the Senate and Republicans the House of Representatives.
Paul Ryan, chairman of the House budget committee, and Mitch McConnell, Senate Minority leader, said the proposal would stunt growth and be a disincentive to corporate investment in an already faltering economy.
"It adds further instability to our system, more uncertainty, and it punishes job creation and those people who create jobs," Mr Ryan told Fox News. "Class warfare may make for good politics but it makes for rotten economics."
"It's a bad thing to do in the middle of an economic downturn," Mr McConnell said on NBC's 'Meet the Press'. "There is bipartisan opposition to what the president is recommending already."
Mr Obama will lay out his recommendations today and is expected to urge steps to raise tax revenue as well as cuts in spending. The supercommittee of six Democratic and six Republican lawmakers must find at least $1.2 trillion (€875bn) in deficit savings before the end of the year to avoid painful automatic cuts. (© Daily Telegraph, London)