The Senate kills Obama's "Buffet Rule"

Republicans block debate on minimum tax rate but polls show public support.

US billionaire Warren Buffett's famous observation that he pays less tax than his secretary gave Barack Obama the political opening he needed to shift the tax debate to the left. The US President proposed a minimum tax rate of 30 per cent for those earning over $1 million (£630,000) a year, a measure that became known as the "Buffet Rule" (the inspiration for Nick Clegg's "tycoon tax").

But last night the resultant bill - the Paying a Fair Share Act 2012 - was blocked after the Senate voted not to open debate on it. The chamber backed the measure by 51 votes to 45 but this was nine short of the 60 votes the Democrats neeeded to overcome a Republican filibuster. In total, forty four of the 47 Senate Republicans voted against a debate, with just one - Senator Susan Collins of Maine - voting in favour.

Obama responded by arguing that "It's just plain wrong that millions of middle-class Americans pay a higher share of their income in taxes than some millionaires and billionaires." But he will be comforted by the knowledge that it is the Democrats, not the Republicans, who are on the right side of public opinion. A CNN poll published yesterday showed that 72 per cent of the US electorate, including 53 per cent of Republicans, support the Buffet Rule. As Charles E. Schumer, the Democratic Senator for New York, observed, for the first time in decades, the GOP is on the defensive on the signature issue of taxation.

Uncomfortably for the Republicans, their presidential candidate of choice - Mitt Romney - is a major beneficiary of the current system. As his 2011 tax return revealed, he paid an effective rate of just 15 per cent on an income of $20.9m. Obama paid 20.5 per cent on an income of $789,674, a lower rate than many US voters but higher than Romney. Moreover, the President can point to the fact that he is at least trying to solve the problem. As the White House noted:

Under the president's own tax proposals, including the expiration of the high-income tax cuts and limitations on the value of tax preferences for high-income households, he would pay more in taxes while ensuring we cut taxes for the middle class and those trying to get in it

Unsurprisingly, then, Romney is under pressure to release his tax returns for before 2010. The longer the Democrats can keep this story on the front pages, the better for Obama. Romney may quip that the Buffet Rule would only raise enough to fund the government for 11 hours but he should never underestimate the symbolic force of taxation.

Barack Obama speaks during a visit to the Port of Tampa on April 13, 2012 in Florida. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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A global marketplace: the internet represents exporting’s biggest opportunity

The advent of the internet age has made the whole world a single marketplace. Selling goods online through digital means offers British businesses huge opportunities for international growth. The UK was one of the earliest adopters of online retail platforms, and UK online sales revenues are growing at around 20 per cent each year, not just driving wider economic growth, but promoting the British brand to an enthusiastic audience.

Global e-commerce turnover grew at a similar rate in 2014-15 to over $2.2trln. The Asia-Pacific region, for example, is embracing e-marketplaces with 28 per cent growth in 2015 to over $1trln of sales. This demonstrates the massive opportunities for UK exporters to sell their goods more easily to the world’s largest consumer markets. My department, the Department for International Trade, is committed to being a leader in promoting these opportunities. We are supporting UK businesses in identifying these markets, and are providing access to services and support to exploit this dramatic growth in digital commerce.

With the UK leading innovation, it is one of the responsibilities of government to demonstrate just what can be done. My department is investing more in digital services to reach and support many more businesses, and last November we launched our new digital trade hub: www.great.gov.uk. Working with partners such as Lloyds Banking Group, the new site will make it easier for UK businesses to access overseas business opportunities and to take those first steps to exporting.

The ‘Selling Online Overseas Tool’ within the hub was launched in collaboration with 37 e-marketplaces including Amazon and Rakuten, who collectively represent over 2bn online consumers across the globe. The first government service of its kind, the tool allows UK exporters to apply to some of the world’s leading overseas e-marketplaces in order to sell their products to customers they otherwise would not have reached. Companies can also access thousands of pounds’ worth of discounts, including waived commission and special marketing packages, created exclusively for Department for International Trade clients and the e-exporting programme team plans to deliver additional online promotions with some of the world’s leading e-marketplaces across priority markets.

We are also working with over 50 private sector partners to promote our Exporting is GREAT campaign, and to support the development and launch of our digital trade platform. The government’s Exporting is GREAT campaign is targeting potential partners across the world as our export trade hub launches in key international markets to open direct export opportunities for UK businesses. Overseas buyers will now be able to access our new ‘Find a Supplier’ service on the website which will match them with exporters across the UK who have created profiles and will be able to meet their needs.

With Lloyds in particular we are pleased that our partnership last year helped over 6,000 UK businesses to start trading overseas, and are proud of our association with the International Trade Portal. Digital marketplaces have revolutionised retail in the UK, and are now connecting consumers across the world. UK businesses need to seize this opportunity to offer their products to potentially billions of buyers and we, along with partners like Lloyds, will do all we can to help them do just that.

Taken from the New Statesman roundtable supplement Going Digital, Going Global: How digital skills can help any business trade internationally

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