Monday, November 30 2020


Clinton calls for 4 per cent tax surcharge on US wealthy

Update: January, 12/2016 - 12:00

WASHINGTON — White House hopeful Hillary Clinton has called for a 4 per cent "surcharge" tax on the wealthiest Americans, seeking to ensure that multimillionaires do not pay lower rates than middle-class families.

The surcharge proposed by Clinton would impact those who make more than US$5 million per year, or about 0.02 per cent of the taxpaying public, and would raise more than $150 billion over 10 years.

"This surcharge is a direct way to ensure that effective rates rise for taxpayers who are avoiding paying their fair share, and that the richest Americans pay an effective rate higher than middle-class families," a Clinton aide said on Monday.

Clinton, a former secretary of state and the Democratic presidential frontrunner, unveiled her plan for the "fair share surcharge" at an event in Iowa, the state which on February 1 votes first in the US nominations race.

She has long supported the so-called "Buffett Rule", named after billionaire investor Warren Buffett, which was proposed by the Obama administration back in 2011.

If implemented, the measure would ensure that tax rates of at least 30 per cent apply to individuals making $1 million or more annually.

Buffett, who campaigned alongside Clinton last month, has strongly criticised tax policies that allow millionaires to pay a lower tax rate than middle-income Americans.

Clinton's campaign noted that in 2013, the top 400 American earners – making more than $250 million per year on average – paid an effective tax rate of just 23 per cent.

She is expected to unveil more elements to her proposal later this week, along with furthering plans to provide tax relief for middle-class households.

Clinton has already proposed a $350 billion plan to reduce debt for college students, costs she said would be paid for through closing certain tax loopholes.

She has also pledged not to hike taxes on families earning less than $250,000 per year.

Of the current 12 Republican presidential candidates, several have called for reducing the tax rates for all Americans.

Frontrunner Donald Trump wants the highest income tax rate reduced to 25 per cent from the current high of 39.6 per cent, while Senator Ted Cruz, who is in second place in many national polls, has called for a 10 per cent flat tax on all individuals. — AFP

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