Support Cloture on the "Buffett Rule" (S. 2230)
Advocacy Letter - 04/16/12
Source: The Leadership Conference on Civil and Human Rights
Recipient: U.S. Senate
On behalf of The Leadership Conference on Civil and Human Rights, a coalition of more than 210 national organizations, we urge you to support cloture on S. 2230, the “Paying a Fair Share Act of 2012.” S. 2230 would implement the so-called “Buffett Rule,” named after billionaire investor Warren Buffett, who famously noted that he pays a lower income tax rate than his secretary. The proposal would greatly improve both the fairness and the fiscal responsibility in our tax code.
In recent years, as shown by the White House National Economic Council, many of our nation’s top earners have been paying income taxes at a lower rate than middle class Americans. For example, twenty-four percent of all millionaires (about 55,000 taxpayers) face a tax rate that is lower than the rate faced by nearly 1.5 million taxpayers making between $100,000 and $250,000. In 2009, 1,470 millionaires managed to pay no federal income taxes at all. Moreover, it has become easier in recent years for top earners to get away with lower tax rates. The top 1 percent of taxpayers paid income taxes in 2008 at an average rate of about 23 percent – far less than they paid before the Bush-era tax cuts, and about a third less than they paid in 1980.
The large – and growing – disparities in the tax code have come at a considerable expense, and are making it far more difficult for our government to operate in a fiscally responsible manner. According to the Center on Budget and Policy Priorities, simply returning the average tax rate on the top 1 percent of taxpayers to its 1996 level of 29 percent could raise about $100 billion per year, or $1 trillion over the next decade. While this obviously would not solve the country’s long-term fiscal problems, it would have a significant impact without harming economic growth.
We do not relish the idea of raising taxes on anyone. Yet as our government continues to work on the critical issue of deficit reduction in the coming years, it is clear that higher-income people can and should share in the sacrifices. If revenues are not increased, deficit reduction will have to come from spending reductions alone, requiring draconian cuts similar to those in the recent House budget proposal – with catastrophic consequences for Medicaid, Medicare, education, transportation, and other vital services and programs – and making it even more difficult for the government to respond to economic downturns in the future.
S. 2230 takes a simple, fiscally sound, and fair approach to eliminating the loopholes that allow many millionaires and billionaires to avoid paying their share in federal income taxes. It would require an individual taxpayer whose adjusted gross income exceeds $1 million to pay a minimum tax rate of 30 percent. While this measure would certainly not solve all of the problems with our nation’s tax code, it is a profoundly important first step in reform. We urge you to support cloture on S. 2230 when it comes up on the Senate floor today.
Thank you for your consideration.
President & CEO
Executive Vice President