Re Obama's "Buffett Rule":
Yesterday, Buffett declined the request of a Republican congressman to swap tax returns and reiterated his pledge to publish the form if other billionaires would do the same.
The Congressional Research Service report found that, on average, millionaires paid federal tax at a 30 percent rate, while moderate-income taxpayers, defined as those earning less than $100,000, were taxed at 19 percent.
The overall average, though, “obscures a great deal of variation,” including the finding that 25 percent of millionaires pay lower rates than 10 percent of moderate earners, the report found.
The findings “would be considered a violation of the Buffett Rule, but not to the extent alluded to by Mr. Buffett,”the report says.
The numbers are, of course, the effective rates (ie after deductions), not the marginal rates.
Related, at Human Events: Tax the Rich? It's Been Done, With Depressing Results. A quote:
Here is the story. In 1929, we had a top marginal tax rate of 24% on all income over $100,000. And, according to Historical Statistics of the United States, the federal government took in almost $1.1 billion that year from income taxes. In 1935, after FDR successfully enacted a 79% tax on multimillionaires, the federal revenue from income taxes had been more than cut in half, down to $527 million. Granted, we were in a Great Depression in 1935, but that is in part because we were steadily adding new taxes and raising taxes on income from 1929 to 1935, and those rate hikes helped cause and perpetuate the Great Depression. Why should entrepreneurs invest and take risks when they have to turn more than half of what they might make over to the government?
During World War II, FDR further expanded the federal government. He did not let that crisis go to waste. On taxes, he eventually raised marginal tax rates on the rich to 94% on all income over $200,000. In making the case for huge tax hikes on the rich, Roosevelt’s supporters argued in Congress that government had the first claim on the wealth people earned. On March 30, 1943, Rep. Emanuel Celler (D.-N.Y.) argued, “The government can at any time make income taxes as thumping big as the necessities of war require. Thus, if any plan does not raise enough money, taxes can at any time be increased. The government always has a moral if not actual lien on all our income.”
In other words, it's not our money.
