Buffett: Share the sacrifice
Mega-rich investor says wealthy should pay higher taxes
Let’s hear it for Warren Buffett, the mega-rich CEO of Berkshire Hathaway. In an essay published Sunday (Aug. 14) in The New York Times titled “Stop Coddling the Super-Rich,” he puts the lie to all those who insist that America’s millionaires and billionaires pay more than their fair share in taxes.
Last year Buffett paid $6,938,744 in federal income and payroll taxes. “That sounds like a lot of money,” he writes. “But what I paid was only 17.4 percent of my taxable income—and that’s actually a lower percentage than was paid by any of the other 20 people in our office.”
Many of the super-rich pay even less than he does—15 percent on most of their earnings and practically nothing in payroll taxes. Most members of the middle class, on the other hand, “fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot.”
There is no correlation between taxes and investments, Buffett writes. “I have worked with investors for 60 years, and I have yet to see anyone … shy away from a sensible investment because of the tax rate on the potential gain.”
If it were up to him, he would leave the tax rates “for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This helps the poor and the middle class, who need every break they can get.”
For the 236,883 households making more than $1 million, however, he’d raise rates immediately on taxable income in excess of $1 million, including dividends and capital gains. And for the 8,274 people who make $10 million or more, he’d favor an additional increase in rates.
“My friends and I have been coddled long enough by a billionaire-friendly Congress,” he writes. “It’s time for our government to get serious about shared sacrifice.”