Sunday, November 4, 2007

Warren Buffett: I don't pay enough taxes!

It may seem surprising that one of those calling for tax fairness in the US just happens to be one of the biggest beneficiaries of the Dubya tax cuts: Warren Buffett, the Chairman of Berkshire Hathaway and the third richest human being on the planet. But Buffett's been complaining the middle class has been shafted for a long time. And last week, he really started to rattle his saber and said enough is enough.

To prove his point, he calculated his effective tax rate on his multimillion dollar salary: 17%. Then he asked a random sample of his office pool at the Omaha, Nebraska -- based company to crunch their own numbers. Of the 18 he picked, 15 responded and not one, not even his own secretary (who packs in a cool $60k per year), had an effective rate below 30%.

Not only does he say he's not paying enough tax, Buffett also supports keeping the inheritance tax, going against the GOP which calls for its outright repeal. Not that it's going to hit his kids anyway -- he's already decided to donate over 80% of his fortune to the foundation run by Bill and Melinda Gates.

I'd like to see him put forward some concrete proposals on how this ought to be done. Does he think the top rate should be brought back up to just under 40%, where it was during the Bill Clinton years? Where would he set the basic exemption? What should the cap be on FICA tax? (Currently, the Social Security tax for wage earners is 7.65% of income to a maximum gross of $102,000 for employees, or $7803; double that for self-employed people -- which rate is actually much higher than the combined amount Canadians pay for EI and CPP or RRQ). And of course, how would he tax capital gains and dividends? (Most of the Wall Street crowd want all capitals gains to be tax free, all capital losses ineligible as writeoffs).

Still, it's refreshing to see someone of influence go against the grain and take the side of the progressives. To say that government should be a hand up, not a hand out; and that it's those who create the wealth that should carry the burden -- not those who sell their labour for wages.

Bill Maher adds his two cents:

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Abdul-Rahim said...

It's disgusting the amount of tax cuts that the richest get in the U.S. at the same time that neoliberals are trying to say there isn't enough money to give all U.S. children free healthcare.

Oldschool said...

According to the Internal Revenue Service . . . the top earning 20% pay almost 70% of income taxes. The bottom 50% pay only 3%.
Of course the fact that since the "Bush" tax cuts the actual tax revenues have increased, unemployment has decreased to a 30 year low of 4.6% mean nothing to tax and spend types.
If Buffet feels so bad I am sure they will take contributions.
Wasn't it John Kennedy who said . . . . lower taxes equal more govt revenue!!!