Obama's "Warren Buffet? Tax" Some analysis from CNN (video): http://www.cnn.com/video/#/video/bestoftv/2011/09/19/current-tax-structure-fair-to-all.cnn?hpt=hp_t2 We've had a number of discussions about Warren Buffett's 'my secretary pays more in taxes than me' claim and as far as I can tell, we always at least agreed about what he was talking about: he's combining the federal income tax with the payroll tax. But the analysis from CNN above shows an oversimplified graphic of a person making $50K a year and being in the 25% bracket vs a person who makes $1 million a year via capital gains and pays 15% -- and these are compared as if the person making $50K actually pays 25% in taxes instead of that just being the marginal rate and the average rate being much less (perhaps even zero after deductions). Clearly, the graphic is wrong in its apples to oranges comparison, but for people who make $75-$100k who don't have mortgages or kids, it may be true that they pay a higher than 15% average rate. So what does this proposal by Obama actually mean? First, is he really referring to just the federal income tax or the mixed-together income and payroll tax rate we always assumed Buffett was talking about? And second, how exactly does he propose to fix this inequity? By eliminating the payroll tax cap (income >$105k doesn't get payroll-taxed)? By increasing the capital gains tax rate? By hiking the upper marginal rate? Well apparently (according to the WH press secretary in the video), he's not even going to tell us what he's talking about much less how to do it: it is up to Congress to figure it out. We've also had threads about Obama's lack of coherent plans, but wow.