Today, Senate Democratic Leaders unveiled a legislative package to replace the looming across-the-board spending cuts known as the sequester. Among the core components of this plan to raise new revenue and make responsible cuts is the Buffett Rule, which was originally written and introduced by U.S. Senator Sheldon Whitehouse (D-RI) last year.
The Buffett Rule provision, based on Whitehouse's Paying a Fair Share Act, would ensure that multi-million-dollar earners pay a minimum effective tax rate of 30 percent. By doing so, it would raise an estimated $53.6 billion in new revenue over ten years. Whitehouse introduced his own sequester-replacement bills earlier this week that demonstrated that we can achieve substantial deficit reduction in ways that do not harm the middle-class. Both of Whitehouse's bills also included included the Buffett Rule. He also re-introduced the Paying a Fair Share Act as a stand-alone bill yesterday.
"The Buffett Rule will help ensure a basic level of fairness in our tax system and generate billions in new revenue. It's a common-sense addition to any deficit-reduction plan, and I'm glad it has been adopted by Senate leadership," Whitehouse said. "I would have preferred to focus even more on loophole-closing in our effort to replace the sequester, and I hope to have an opportunity to improve the plan as the process goes forward. But this plan is a step in the right direction and is worth supporting."
Senator Tammy Baldwin (D-WI) cosponsored Whitehouse's re-introduced bill yesterday, and served as the lead sponsor in the House of Representatives last year.
"If we're going to create shared prosperity and strengthen middle class economy security, everyone has to do their fair share so that everyone has a fair shot," Baldwin said, "We need to move our economic recovery forward and reduce our deficit without shortchanging our future. The Buffett Rule will ensure that our path forward is guided by fairness and that our tax system reflects the need to make sure that everyone plays by the same rules."
Last year, Whitehouse's Buffett Rule legislation was endorsed by a coalition of more than 100 national, state, and local organizations, as well as by Warren Buffett himself. The proposal is named after Mr. Buffett, the legendary investor who has famously pointed out that he pays a lower tax rate than his secretary. It received a majority of votes in the Senate, but was ultimately stopped by a Republican filibuster.