Elections

Clinton to propose further tax increases on wealthy Americans at Buffett event

Warren Buffett to endorse Hillary Clinton
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Warren Buffett to endorse Hillary Clinton

Democratic presidential candidate Hillary Clinton plans to signal she'll propose further tax increases on wealthy Americans Wednesday while collecting a public endorsement from one of the wealthiest, billionaire investor Warren Buffett.

Buffett has made clear his support for Clinton in interviews and campaign fund-raisers. But his public appearance at her side in Omaha is rare, and she's using it to amplify her tax policy approach with just weeks to go before she squares off against Sen. Bernie Sanders at the Iowa caucuses and New Hampshire primary.

Clinton has proposed large new spending plans for such priorities as making college more affordable, expanding infrastructure, and bolstering access to child care and early childhood education. The Republican National Committee estimates the total cost of those proposals so far at $1.2 trillion over 10 years.

Democratic presidential candidate Hillary Clinton and Warren Buffett.
Noah Berger | Bloomberg | Getty Images

The Democratic front-runner has vowed to pay for those plans without increasing taxes on Americans earning less than $250,000 a year. But she has yet to specify tax hikes on wealthier Americans and corporations sufficient to pay those bills. The Committee for a Responsible Federal Budget estimates that Clinton's tax increases so far would raise slightly more than $800 billion over 10 years.

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In her remarks alongside Buffett, a campaign official said, Clinton will point to how she will begin to fill that gap of roughly $400 billion, or $40 billion per year. Specifically, the official said, that will include an "expanded" version of what the Obama administration has dubbed its "Buffett rule" proposal that Buffett backs. The rule seeks to ensure that American households earning at least $1 million per year pay an effective tax rate of at least 30 percent — which many do not currently.

The campaign official said Clinton will not specify elements of the expanded Buffett rule on Wednesday. Nor will she signal whether details of her tax plan coming in January will include an increase in the top personal income tax rate of 39.6 percent. In his 2013 "fiscal cliff" tax deal with Republicans in Congress, President Barack Obama returned the top rate to that level — which matched the top rate at the end of the term of Clinton's husband, President Bill Clinton.

According to the conservative Tax Foundation, closing the gap between Clinton's proposed spending and her tax proposals by raising the top rate alone would require at least a 4-percentage-point increase to 43.6 percent. Foundation President Scott Hodge said each percentage-point increase would raise approximately $100 billion over 10 years on a "static" basis without accounting for shifts in economic behavior.