FT: Obama's State of the Union calls for higher taxes on wealthy
Barack Obama laid down the battle lines for the presidential election Tuesday night as he promised a “fairer” tax regime on the day Mitt Romney, the leading Republican contender, revealed that he paid federal income taxes at an effective rate of just 13.9 per cent in 2010.
The comparatively low rate reflects the fact that most of Mr Romney’s income is taxed as capital gains, an issue that Mr Obama tackled head-on in his State of the Union address.
The US president said tax reform and budget reduction should be guided by the principle that anyone with annual income of more than $1m should pay a minimum effective tax rate of 30 per cent.
Mr Obama’s benchmark – the Buffett rule, named after Warren Buffett – says the richest Americans should not pay tax at a lower rate than their secretaries, a policy dressed up by inviting the billionaire investor’s long-time personal assistant to watch the address from the first lady’s box in Congress.
“You can call this class warfare all you want. But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense,” he said.
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Q
Sadly my son passed away a couple of years ago leaving two teenage children, and while we have a very good relationship with our daughter-in-law she has indicated she doesn’t want to remain a widow as she is only in her early 40’s. What is the best way to structure what would have been our son’s inheritance to ensure it goes to our grandchildren without alienating their mother?
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Although statistically unlikely, it is sadly the case that some children die before their parents and most well-written wills provide for that contingency. Although testators sometimes wish to make provision for the spouse of a deceased child, it is usual for the will to include a term that if a child predeceases the testator, his or her children will step into their parent’s shoes.
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