Philanthropist and billionaire, Warren E. Buffett, chairman and chief executive of Berkshire Hathaway, is imploring Congress to stop coddling the super-rich and get him and others like him to pay more taxes.
In an opinion piece in the New York Times, Buffett debunks the Republicans’ myth that if millionaires and billionaires were taxed any more they would not invest in America and as a consequence jobs would be lost. He observes that in the 1980s and 1990s, tax rates on the wealthy were far higher than they are now and that they not stop the rich from investing.
“… I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain,” Buffett states.
Buffett laments the lower tax rate on personal incomes that the rich and super-rich have paid overtime. Yet, the tax burden of working Americans is invariably much higher that what those who can most afford it pay to the I.R.S.
“The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes,” Buffett writes. “It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot.”
Buffett has a word too, for the 12-person committee set up by Congress to devise a plan to reduce the deficit by at least $1.5 trillion over the next 10 years.
In his view, the committee should go beyond this in terms of deficit reduction.
He believes that the committee has an opportunity to identify big savings, while at the same time, boosting revenues. Buffett recommends leaving tax rates for 99.7 percent of taxpayers unchanged, while continuing to reduce the current 2 percent reduction in employee contribution to the payroll tax.
“But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains,” Buffett writes. “And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.”
