President Obama's proposed 'Buffett Rule' and the 'Millionaire Surtax' recently put forward by Senate Democrats share a common theme: require millionaires and billionaires to shoulder a larger proportion of the nation's tax burden.
They are not, however, exactly the same.
During his news conference this morning, Obama drew a clear distinction. The 'Buffett Rule' targets wealthy Americans who are paying a lower overall tax rate because some or all of their income is from investments that are taxed at the 15 percent capital gains rate. That's roughly half the rate on income from a salary.
The president's support of the 'Buffett rule' is part of his call for a longer-term reform of the tax system to close "loopholes" and "special interest tax breaks" while lowering overall rates.
The Obama Administration did not include the 'Buffett Rule' in its plan to pay for a more immediate goal, the American Jobs Act.
Senate Democrats did add a provision to the jobs bill that would cover its costs with a five- percent surtax on "millionaires." That surtax would be imposed on all adjusted gross income above $1 million — including, but not limited to, income from capital gains and dividends.