Warren Buffett is admittedly sitting pretty, even within the top 1 percent: In a letter to a Republican congressman this week, the Berkshire Hathaway chairman disclosed that he made nearly $63 million last year, but paid less than $7 million in federal income tax. Buffett is using his own numbers to push the Senate proposal by Democrats for a 5.6 percent surtax on anyone making at least seven-figures a year, referred to by President Obama as "The Buffett Tax." And he's urging his Über-wealthy counterparts to do the same: "If you could get other ultra rich Americans to publish their returns along with mine, that would be very useful to the tax dialogue and intelligent reform," he wrote.
Buffett's plan for debt reduction echoes his August New York Times column, which put his federal taxes at $6,938,744, or 17.4 percent of his taxable income, and cemented Buffett as an ally of the president in the federal debt fight. The numbers usually break down more like this:
According to the Tax Policy Center, a nonpartisan group, the average tax rate for taxpayers in the middle quintile—those earning between $34,000 and $60,000 a year—is 12%, including payroll and income taxes. Those earning from $103,000 to $163,000--the top 80% to 90% of earners—pay 18.2%. Those earning from $163,000 to $211,000 pay 19.8%, and those earning from $211,000 to $533,000 pay 20.4%.
But Buffett insists that the super-rich know how to work the system, and hardly need more tax breaks. "I hope you succeed in getting the ultra rich — who, as a group, are paying less of their income to the federal government than their receptionists — to share in the sacrifice many millions of other Americans soon will be asked to do," Buffet wrote.
Last week, Representative Tim Huelskamp of Kansas dared Buffett to take his disclosures further, writing, "If your name is lent to a national policy and your story the justification for a major overhaul to the tax code, then the American people have a right to see the evidence guiding that policy."
Buffett agreed, and even raised the stakes, arguing that if the richest 400 Americans put out their own records, even anonymously, it "would be a big step in informing legislators and the public of what needs to be done." He then forwarded his letters with the Republican freshman to the Congressional super-committee noting, "You may find some of the figures helpful in your deliberations." That's rich.
Previously: Obama Proposes Millionaire ‘Buffett Tax’ and Sets the Stage for a New Government Showdown [NYM]
Warren Buffett Brings Tax Fight to Supercommittee [AP via ABC News]
Buffett Builds His Tax-the-Rich Case [WSJ]