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'Buffett rule' fails, but it will be back

The Buffet rule to raise taxes on millionaires couldn't get through the Senate, but both parties promise to make it a campaign issue as the nation heads toward Election 2012. 

By / April 16, 2012

Billionaire Warren Buffett in a file photo.

Rick Wilking/Reuters/Files

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WASHINGTON

The so-called Buffett rule’s first trip into the US Senate was a well-anticipated bust.

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But, Democrats and Republicans say, it may yet live on as the election season heats up, and both sides appear ready to put the measure to work.

The 51-to-45 vote meant the bill fell short of the 60 votes it needs to avoid a filibuster. It was supported by every voting Democratic senator save one (Mark Pryor of Arkansas) and was rejected by every voting Republican senator save one (Susan Collins of Maine). It would have put a minimum 30 percent federal income tax on Americans making more than $1 million annually.

Sen. Charles Schumer (D) of New York suggested that the Buffet rule – which is named for billionaire investor Warren Buffett, who supports it – is not going away. One way to keep it alive: link the revenue raised by the proposal to other priorities.

“We’re going to come back to this issue repeatedly, and it may be tying it to what it means to people,” said Senator Schumer, the chairman of the Democratic Policy Committee, in a conference call with reporters Monday. “Forty-seven billion dollars could help pay for kids costs for college ... maybe it should to help businesses with an R&D tax credit, maybe it should go to deficit reduction."

"There are lots of ways I think the American people would prefer to spend $47 billion than tax breaks for millionaires and billionaires that aren’t paying what the average person pays,” he added.

By linking tax increases to tangible items like college costs, Democrats think they can paint Republicans as rigidly avoiding tax increases while cutting services for poor Americans.

Rep. Chris Van Hollen of Maryland, the top Democratic member of the House Budget Committee, provided a preview of the Democratic line of attack. He noted how many Republicans have signed the Americans for Tax Reform pledge, which obligates them to reject any tax increases, but have endorsed a Republican budget proposal that cuts food-stamp funding and sets up tougher restrictions on Medicaid funding.

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