FILED IN: Politics

Do middle-class families pay more taxes than the rich and powerful?

President Obama claim fact checked

President Obama's statement about taxes is fact checked. Official White House Photo by Pete Souza

While speaking in the White House Rose Garden on Monday, President Barack Obama said he thinks the tax burden is upside down, with people on the lower rung of the ladder paying more than the rich.

Obama said, “Middle-class families shouldn’t pay higher taxes than millionaires and billionaires.” He added, “It’s hard to argue against that.” The statement was made in regard to the proposed “Buffet Rule,” which would be a new statement in the tax code that would make official that those with income over $1 million in a given year “should not pay a smaller share” in taxes than the middle-class.

While that indeed is “hard to argue” on its face, the question remains, do the middle-class currently pay more in taxes than the upper-crust of society?

The Associated Press fact checked that claim against data from the Internal Revenue Service, and what it found indicated that the Buffett Rule — named after billionaire Warren Buffett, who recently stated in an op-ed piece that he’s not taxed enough — is unnecessary.

According to AP, households reporting over $1 million on their tax returns will pay 29.1 percent of their income on average in federal income taxes, while families earning between $50,000 and $75,000 will only pay 15 percent.

Those earning below that threshold will generally pay taxes in a range of 12.5 percent down to 5.7 percent.

The Tax Policy Center indicated that 46 percent of households will not owe a single cent in federal income taxes for 2011, although they still pay taxes such as Social Security and Medicare.

The IRS did indicate that approximately 1,500 high-earning households paid no federal income taxes in 2009, likely due to various deductions, but that represents a fraction of the 236,000 income tax returns filed with income over $1 million. The IRS statistics also showed that those households paid over 20 percent of overall federal income tax revenue.

According to Fox News, the Obama campaign sent out an email to supporters in defense of the Buffett Rule, which said, “This proposal makes sure millionaires and billionaires share the responsibility for reducing the deficit. The other side is already saying it’s ‘class warfare’ — that’s their rhetorical smokescreen for providing millionaires and billionaires special treatment.”

Two Republican governors weighed in on the proposed Buffett Rule. Indiana Gov. Mitch Daniels called it a “loser” and “purposely divisive,” and Louisiana Gove. Bobby Jindal said the president “doesn’t get it.”

According to Forbes, New York Gov. Andrew Cuomo, a Democrat, said he supports higher taxes for millionaires and corporations if it will “create jobs, balance the budget and lower the deficit.”

In a joint session of Congress held earlier this month, President Obama repeatedly urged legislators to pass his proposals “right away.”