“What is wrong with raising the capital gain’s tax from 15% to 20%? What’s wrong with [Warren] Buffett’s idea of a minimum tax for the super rich of 30%?” Morning Joe’s Joe Scarborough asked on Thursday. “So that those people aren’t paying 14% taxes when the rest of Americans are carrying their full road.”
Having advocated for lower capital gains taxes in the past, the present day requires a hike in those rates, Scarborough said. “Here we are in 2012, with the richest of the rich paying 14%, 15% in taxes because of the capital gains tax,” Scarborough said. “And you even have me going what is wrong with a party that believes in free enterprise, in fair play, in working class Americans” raising the capital gains tax?
Raising marginal rates won't hit the wealthy, Scarborough argued in his latest Politico column, but it will hurt small businesses.
For these wealthy taxpayers, powerful accountants and tax lawyers always make sure their “income” is rarely subject to top marginal tax rates. But that’s not the case for small-business owners who make far less but are still subjected to the pain of tax hike plans passed under the guise of making the tax code more equitable. Because these taxpayers can’t afford the best accountants that money can buy, they bear the brunt of Washington’s feel-good fantasy tax on the ultra-rich.
If politicians really want to make millionaires and billionaires pay at a tax rate that most of us endure on April 15th, their moral pangs would be soothed more effectively by following Buffett’s minimum tax plan or focusing on raising the tax rates on capital gains and carried interest.
Warren Buffett explained and advocated for a minimum tax rate on Morning Joe on Tuesday.
His proposed minimum would tax the wealthy at a rate of 30% on income above $1 million and 35% on income above $10 million. “It would hit me!” Buffett said on Tuesday. Instead of his rate of 15% or 16%, Buffett says he’d end up paying around 35%.
Former Republican National Committee Chairman Michael Steele argued that reworking the tax code would go hand-in-hand with reworking the party's appeal.
“I think the party has a window now to come to the table in an honest way, to be a party of the middle class, to more importantly be the party of the poor, to make the argument of elevating people out of poverty into ownership through our tax system,” Steele said, adding that instead of demonizing the wealthy as Democrats have, the party should say they "have is an expectation that you will work with us to help lift everybody’s boat."
“This fiscal cliff is a good opportunity to begin that conversation,” Steele added.