Barack Obama to Propose New Tax Rate for Millionaires

President Barack Obama will propose a new minimum tax rate for U.S. taxpayers who earn more than $1 million to help lower the nation's $1.5 trillion long-term debt, according to media reports. This plan will be adopted from a suggestion made by billionaire investor Warren Buffett.

The president is expected to seek a new base tax rate for individuals making more than $1 million a year to ensure that millionaires pay at least the same percentage as middle-income taxpayers, The New York Times reported citing administration officials. Obama's new tax proposal was first reported by the New York Times.

Obama is going to call it the Buffett Rule for Warren Buffett, the billionaire investor who has complained that rich people like him pay a smaller share of their income in federal taxes than middle-class taxpayers, according to the Associated Press.

A White House official told the AP that the new tax plan would be included in the president's proposal for long term deficit reduction that he will announce Monday.

The general goal would be to prevent people earning more than a million dollars to pay taxes at a lower effective rate than people who earn under $250,000. That's often the case because investment income, or capital gains, is taxed at a lower rate than regular wages, according to the Wall Street Journal.

The measure would be in addition to $447 billion in new tax revenue that Obama is seeking to pay for his short-term spending and tax cutting plan to jump start the economy, according to the AP.

The proposal is likely to meet a strong challenge in Congress, where Republicans have said they oppose any tax increases, according to the BBC News.

Any new tax will likely face opposition from Republicans, who control the U.S. House and have argued that raising taxes on higher-income individuals would hurt small businesses and stifle investment, according to the Bloomberg.