U.S. President Barack Obama on Monday will propose a higher tax for individuals making more than $1 million a year in a bid to cut the budget deficit, The New York Times reported on Sunday, referring to administration officials.
Obama will call his proposal, intended to make millionaires pay at least the same percentage of their earnings as middle-income taxpayers, the "Buffett Rule," in a reference to Warren Buffett, the billionaire investor who has repeatedly complained that the richest Americans generally pay a smaller share of their income in federal taxes than do middle-income workers as investment gains are taxed at a lower rate than wages, the paper said.
"Mr. Obama will not specify a rate or other details, and it is unclear how much revenue his plan would raise. But his idea of a millionaires' minimum tax will be prominent in the broad plan for long-term deficit reduction that he will outline at the White House on Monday," the paper said.
The millionaires' tax is among several changes Obama will propose in urging Congress to overhaul the federal income tax code next year, both to raise revenues for reducing deficits and to make the tax system simpler and fairer, the paper said, referring to administration officials who agreed to speak in advance of the president's announcement on the condition of anonymity.
The millionaires' rate would affect only 0.3 percent of taxpayers or fewer than 450,000, the paper said.
The Obama proposal has little chance of becoming law unless Republican lawmakers agree to it, the paper said.
"But by focusing on the wealthiest Americans, the president is sharpening the contrast between Republicans and Democrats with a theme he can carry into his bid for re-election in 2012," the paper said.