Durbin, Duckworth Introduce 'Buffet Rule' To Ensure Wealthiest Americans Pay Fair Share In Taxes
Paying a Fair Share Act would ensure multi-million-dollar earners pay at least 30 percent effective tax rate
WASHINGTON – With income inequality soaring to a level not experienced in America since prior to the Great Depression, U.S. Senators Dick Durbin (D-IL) and Tammy Duckworth (D-IL), along with Senator Sheldon Whitehouse (D-RI), introduced legislation to prevent America’s top earners from paying lower tax rates than middle-class families. The Paying a Fair Share Act would ensure that multi-million-dollar earners pay at least a 30 percent effective federal tax rate, also known as the “Buffett Rule”. The measure would reduce the federal deficit by an estimated $119 billion over the next decade.
“The Trump Administration has found every which way to make life easier on the wealthiest earners, while working and middle class Americans are stuck struggling to make ends meet,” Durbin said. “It doesn’t make sense that the uber-wealthy can exploit loopholes in our tax system – now made easier by the President’s tax law – and pay a lower federal tax rate than the middle class. It’s time we restored some fairness in our tax code and the Buffett Rule can be an important step in that direction.”
“Something’s wrong when the wealthiest among us are able to exploit loopholes in the tax code to pay taxes at a lower rate than working and middle-class families,” Duckworth said. “Hardworking Americans deserve a break, yet the Republican tax bill passed last year was nothing more than a massive giveaway to the wealthy and big corporations that made matters worse. I am glad to join Senators Whitehouse, Durbin and my colleagues in introducing legislation to finally end this imbalance and make sure billionaires and the wealthiest one percent are paying their fair share.”
The bill is also sponsored by Senators Jeff Merkley (D-OR), Jack Reed (D-RI), Richard Blumenthal (D-CT), Dianne Feinstein (D-CA), Chris Van Hollen (D-MD), Cory Booker (D-NJ), Tammy Baldwin (D-WI), Elizabeth Warren (D-MA), Ed Markey (D-MA), Amy Klobuchar (D-MN), Patrick Leahy (D-VT), Kirsten Gillibrand (D-NY), and Mazie Hirono (D-HI).
In 2016, the highest-earning 0.001 percent of Americans – making an average of $145 million each – paid an average effective federal tax rate of just 23 percent, far short of the top marginal rate of 37 percent.
The Paying a Fair Share Act would apply only to taxpayers with income over $1 million, including capital gains and dividends, and would phase in over their second million dollars in income. The bill includes language to preserve the incentive for charitable giving. Directions on how taxes would be calculated are available here.
The “Buffett Rule” is named after Warren Buffett, the legendary investor who has famously lamented that he pays a lower tax rate than his secretary. Former President Barack Obama proposed adding the Buffett Rule to the tax code to ensure that those at the top pay at least the tax rate paid by middle-class families.
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