Even though Senate Democratic leaders last night fell nine short of the 60 votes needed to begin debate on the so-called “Buffett rule,” this probably is not the last we witness this ill-conceived tax policy stunt. The legislation (S. 2230) introduced by Sen. Sheldon Whitehouse (D-RI) incorporates the President’s proposal to ensure that taxpayers earning above $1 million pay a minimum tax rate. The “Buffett Rule” moniker comes from comments m de by legendary investor Warren Buffett that he pays a lower tax rate than his secretary. Frankly, it should be renamed as the “Buffett Tax Hike.”
Sen. Susan Collins (R-ME) was the only Republican to support the bill. Sen. Mark Pryor (D-AR) was the only Democrat to oppose it. Sens. Daniel Akaka (D-HI), Orrin Hatch (R-UT), Mark Kirk (R-IL) and Joseph Lieberman (ID-CT) did not vote. The Joint Committee on Taxation (JCT) estimates that the bill would raise almost $47 billion over 10 years.
In the run-up to last night’s debate on the procedural vote to move forward, NAM sent a letter to all members of the Senate, expressing our strong opposition to the mis-named “Paying a Fair Share Act” that actually would place a new punitive tax on our nation’s small business owners and job creators. While NAM members believe that reform of our anti-growth tax system is critical, we disagree with the Administration that the new “Buffett tax,” would improve our tax system. In fact, Sen. Pat Toomey (R-PA) made some great comments on the Senate floor before the vote, debunking any thought that this is fair, pro-growth tax policy.
According to Sen. Toomey, “It’s a political gimmick… not a serious effort to deal with a ridiculously broken tax code….We have a tax debt that’s ridiculous. It is impossible to understand; counterproductive to economic growth; badly needs a complete overhaul that would simplify this code, get rid of unfairness, broaden the base and encourage economic growth. Instead we’ve got this little gimmick because we don’t have the political leadership to deal with the underlying real problem of a badly-flawed tax code.
We can’t agree more with Sen. Toomey that Senate last night wasted their time “ arguing about this political stunt.” Unfortunately, it looks like we can look forward to more time-wasting debate this year. Even before last night’s vote, Senate Finance Committee member Chuck Schumer (D-NY) suggested that the White House and congressional Democrats intend to keep the “Buffett rule” alive at least through November. And in future votes, the stakes might be higher. According to Sen. Schumer, Democrats may propose using the estimated $47 billion that proposal would generate over 10 years to pay for things like the research and development tax credits and deficit reduction. If Democrats are serious about advancing these important issues, let’s abandon the “political stunts” and work with the other side to advance pro-growth, pro-manufacturing tax changes.