Dueling Tax Plans: GOP Small Business Tax Break Vs. Buffett Rule
One party pushes class warfare while the other pushes for job creation
(Politico) With the glare of the public spotlight trained on Tax Day, Congress is readying for a political fight with dueling tax votes this week that will define each party’s priorities in this election year.
In one corner are Republicans, who are touting a tax cut to help boost the bottom line for small businesses. In another corner are Democrats who want to make sure the wealthy are paying their fair share – as a matter of tax fairness and to relieve the burden on the middle class.
Neither bill has a clear path to President Barack Obama’s desk. But Republicans and Democrats alike are confident their respective measures will create a clear distinction for the public on where each party stands.
“I couldn’t think of a more direct contrast with the Democrats believing that you ought to raise taxes,” House Majority Leader Eric Cantor (R-Va.) told POLITICO, comparing the “Buffett rule” with his own tax cut designed for small businesses.
The Senate moves first with a procedural vote Monday on the Buffett rule, which would ensure that millionaires pay an effective 30 percent tax rate on their income. The House follows suit Thursday with a vote on the small business tax cut, which would allow qualifying companies to take a 20 percent tax break that Republican lawmakers say will spur more hiring and investment.
This does create a clear distinction: Republicans are looking for ways to use the tax code to spur small business, creating jobs and wealth. Democrats are using the Buffett Rule to ……. well, something, because the revenue it will supposedly raise is only about $4 billion a year, not exactly chump change to most people, but, miniscule in terms of Central Government spending. It’s all about fairness or something, which, in real terms, is simply a way to fire up Obama’s unhinged base who really hate that others make more money than themselves, and instinctively feel that these rich people stole the money off the work of the little people. Leftists really, for the most part, do not like private sector success.
The Buffett rule is named after billionaire investor Warren Buffett, who disclosed in 2011 that he was paying a tax rate of 17.4 percent – far lower than the rates paid by staffers in his Omaha, Neb., office, which averaged around 36 percent.
If his staffers were paying 36%, Buffett should fire them for being fools. Have they never heard of deductions? Furthermore, the top federal rate for the 2010 tax year was 35% on income of $373,650 and above: did they actually pay a higher percent?
Meanwhile, House Republicans are prepping their small-business tax cut vote that will come later this week. The $46 billion, one-year tax cut would apply to all businesses with fewer than 500 employees, and the tax break would benefit 22 million small businesses, according to Cantor’s office.
This break, which would help small businesses, passed out of committee on a strictly party line vote, and it appears like the Democrats will vote against the bill, because it might possibly help out some rich person. Because we all know that poor people own businesses.
Usually squishy Jennifer Rubin has a good point
But let’s take a step back. Where in this is a plan to accelerate growth and job creation? How does creating a sort of new minimum tax for 4,000 taxpayers assist in the recovery? Maybe that is why Obama and Axelrod spend so much time on gimmicks and phony “fairness” arguments. They haven’t got a clue how to create an economic environment in which investors, employers and consumer will all benefit.
All of Obama and the Dems plans have so far failed. Hope and Change morphed into Despair and Stagnation.
Meanwhile, download your 1040 Buffett Rule tax forms. Oh, and the Buffett Rule depends upon the “Bush tax cuts” expiring in full, meaning the middle and lower classes would pay higher tax rates.