The “Buffett Rule,” a tax increase for millionaires proposed by President Barack Obama, doesn’t represent a panacea for the nation’s budget woes, says investment legend Warren Buffett, for whom the rule is named.
“It is a small improvement in a very bad tax system,” he tells CNBC. “It doesn’t cure all. It doesn’t cure all revenue problems remotely.”
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Obama suggested a minimum tax rate of 30 percent for those earning at least $1 million a year.
Congress’ non-partisan Joint Committee on Taxation estimated that would raise an additional $46.7 billion over the next 10 years.
That would cover only 0.7 percent of the $6.4 trillion increase in spending that would result over the next 10 years from Obama's 2013 budget plan, the Congressional Budget Office estimates.
“In my original article, I said we’ve got major problems on the expenditure side,” Buffett says.
“But, all it [the rule] does is it says, when you’ve got 131 of the 400 largest incomes in the country that are averaging $270 million, if you have a third of them paying at rates less than 15 percent counting payroll taxes, that this is something that should be corrected.”
The rule is really a moot issue at this point in any case. A Republican filibuster has prevented the Senate from passing a version of the Buffett rule.
And even if it were to do so, the bill would undoubtedly be quashed in the Republican-controlled House.
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