Before the Florida trip, the White House released a report by Obama’s economic team making the substantive case for what is essentially a political proposal because it has no chance of advancing in Congress before the election. The Buffett Rule would set a minimum tax rate of 30 percent for individuals on their annual income above $1 million.
The report argued that the minimum tax would restore some fairness to the tax code and reduce economically inefficient gaming of the system. Over five decades since 1960, it said, the average tax rate paid by the wealthiest Americans has dropped much more than the rate for middle-income taxpayers.
“Look, I want folks to get rich in this country,’’ Obama said. “I think it’s wonderful when people are successful. That’s part of the American dream.
“But understand,’’ he added, “the share of our national income going to the top 1 percent has climbed to levels we haven’t seen since the 1920s. The folks who are benefiting from this are paying taxes at one of the lowest rates in 50 years.’’
And Romney will personify that issue if the Obama campaign has its way. With income mostly from investments, Romney paid a tax rate of about 14 percent on about $21 million in income in each of the past two years. That effective tax rate was far below the 35 percent top rate on the highest incomes because much of his income is from capital gains and dividends, which are taxed at 15 percent, and because he claimed an assortment of tax deductions. Hedge fund managers and private equity investors similarly pay the 15 percent rate on their income.
