Warrren Buffett: The Rich Need to Pay More Taxes



  1. "the richest families in our country pay a lower tax rate than the people who take care of their children, or who teach in their schools, or who would put out a fire if their house were to start to burn," sperling said.
    ...
    "you would have to attend 200 funerals to be at one where the deceased's estate had to pay that tax," he told senators.
    ...
    buffett has promised $1 million to the charity of his or her choice for any billionaire who does the math in his or her office and proves him wrong.
    buffett says three of his close friends have taken him up on the challenge and they all came up with the same results: ordinary folks are suffering under tax rates nearly twice as high as what billionaires pay.

    http://abcnews.go.com/gma/story?id=3869458&page=2
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  2. 42 Comments

  3. by   Jolie
    Well, I guess our family is 1 in 200. When my grandfather died, we had to sell a portion of his assets to pay estate taxes, amounting to double taxation, since he had paid income taxes on every dollar he had ever earned.

    Warren is free to pay any amount over and above his tax burden that he feels is fair. I seriously doubt the IRS would turn it down.
  4. by   Spidey's mom
    1 in 200 is still pretty high.

    I am not sure about Warren's stats though.

    He can certainly do whatever he wants with his assets - just don't make the rest of us do it.

    The "rich" get defined more and more as middle-class folks running a small business. Not Ted Kennedy or Warren Buffett.

    steph
  5. by   Spidey's mom
    By the way Warren - I could really use some of your money. I'm going back to school and it will cost $15,000. Plus, I want to be a stay-at-home mom as much as possible so could you pay off our mortgage, our equipment costs for our logging business, my son's student loans, our Sears Credit card, my KIA, our Chevy pickup, our trailer that my dh lives in during the week, my daughter's future college costs, and could you buy my hardworking farming inlaws (who were considered rich when they were dirt poor farmers) get a new car because they've been driving the old thing they've been driving for years. Oh, and the mission organization I'm part of could really use some money to pay for open heart surgeries and cancer treatments for kids in Vietnam - a tiny percentage of all your big bucks could pay for hundreds of surgeries.

    steph
  6. by   HM2VikingRN
    I think what he is speaking to is the fact that our tax coode has become increasingly regressive over the past several years. He is speaking to a misplaced set of National Priorities. He is also speaking in the interest of tax fairness. He is making the point that taxes on the middle class are disproportionately high and that people of his income class are not paying enough into the system relative to the benefits received by them from society.

    The cost of the Bush tax cuts for the upper 1% of the economy has been reliably estimated at 60 billion dollars for next year alone. (That is something like twice the cost of SCHIP for the next FIVE years.).

    See:
    The most recent Internal Revenue Service data back opponents' claims. In 2001, out of 2,363,100 total adult deaths, only 49,911 -- 2.1 percent -- had estates large enough to be hit by the estate tax. That was down from 2.3 percent in 1999. The value of the taxed estates in 2001 averaged nearly $2.7 million.
    http://www.washingtonpost.com/wp-dyn...2005Apr12.html
    Last edit by HM2VikingRN on Nov 18, '07
  7. by   Jolie
    Quote from HM2Viking
    I think what he is speaking to is the fact that our tax coode has become increasingly regressive over the past several years. He is speaking to a misplaced set of National Priorities. He is also speaking in the interest of tax fairness. He is making the point that taxes on the middle class are disproportionately high and that people of his income class are not paying enough into the system relative to the benefits received by them from society.

    The cost of the Bush tax cuts for the upper 1% of the economy has been reliably estimated at 60 billion dollars for next year alone. (That is something like twice the cost of SCHIP for the next FIVE years.).

    See:
    The most recent Internal Revenue Service data back opponents' claims. In 2001, out of 2,363,100 total adult deaths, only 49,911 -- 2.1 percent -- had estates large enough to be hit by the estate tax. That was down from 2.3 percent in 1999. The value of the taxed estates in 2001 averaged nearly $2.7 million.
    http://www.washingtonpost.com/wp-dyn...2005Apr12.html

    If you want to talk about "tax fairness", you need to talk apples to apples. Discussing income tax in the same breath as estate tax is deliberately misleading.

    Estate taxes are nothing more than a thinly veiled money grab based on class envy. People who have worked, risked their assets, employed others, and paid taxes their entire lives, while still managing to build a family farm, business, or personal wealth have already paid their fair share. To penalize their estates and enrich the government at the expense of their rightful heirs is wrong.

    Quit looking for more ill-gotten sources of revenue. Start cutting spending.
  8. by   pickledpepperRN
    Can anyone document that any family farms were lost to the estate tax?
    I heard on the radio that it has never happened.
  9. by   Jolie
    Quote from spacenurse
    Can anyone document that any family farms were lost to the estate tax?
    I heard on the radio that it has never happened.
    My MIL recently sold her aunt's farm to pay estate taxes. She stated that the land was appraised (for tax purposes) at an amount that the family believed to be highly inflated, and they appealed, but were unsuccessful in reducing the amount of taxes due. They had to sell the property to pay the taxes, forcing a cousin to move out and find other housing. The actual selling price, BTW, was significantly less than the value set by the tax appraiser. This was in Wisconsin.
  10. by   mshultz
    Warren Buffet is being disingenuous at best, and hypocritical at worst. If he believes he is not paying enough in taxes, all he has to do is to make a donation to the federal government's "Gift to the United States" account. Not only is he not doing this (to my knowledge), he is sheltering much of his wealth from the estate tax (that he publicly supports) by giving it to tax exempt foundations.

    Larry Elder has questioned how Buffet's secretary can be paying 30% in taxes. My income last year was the same as Buffet's secretary, yet my total percentage of federal, state, and local taxes was 10% of my gross income. This is for a single person without itemized deductions and no dependents, but with the maximum deferred compensation amount. Maybe Warren's secretary could use some of his financial advice.

    If Warren Buffet thinks that his taxes are too low, then he should lead by example. On the other hand, if he thinks the rest of us are not paying enough, why doesn't he just come out and say so?
  11. by   HM2VikingRN
    a little reality check on the estate tax:

    like other americans, the very wealthy benefit from public investments in areas such as defense, education, health care, scientific research, environmental protection, and infrastructure, and they rely even more than others on the government’s protection of individual property rights (since they have so much more to protect). bill gates, sr., a prominent advocate of the estate tax, explains, “the reason the estate tax makes so much sense is that there is a direct relationship between the net worth people have when they pass on and where they live. the government that protects their business activities, the traditions that enable them to rely on certain things happening, that’s what creates capital and enables net worth to increase.” (http://www.cbpp.org/6-1-06tax-transcript.pdf)
    http://www.cbpp.org/pubs/estatetax.htm
  12. by   HM2VikingRN
    Quote from jolie
    my mil recently sold her aunt's farm to pay estate taxes. she stated that the land was appraised (for tax purposes) at an amount that the family believed to be highly inflated, and they appealed, but were unsuccessful in reducing the amount of taxes due. they had to sell the property to pay the taxes, forcing a cousin to move out and find other housing. the actual selling price, btw, was significantly less than the value set by the tax appraiser. this was in wisconsin.
    it must have been a very rare piece of property:

    despite oft-repeated claims that the estate tax has dire consequences for family farms and small businesses, there is in fact very little evidence that it has an outsize impact on these groups. indeed, the american farm bureau federation acknowledged to the new york times that it could not cite a single example of a farm having to be sold to pay estate taxes.
    most recently, an analysis by the congressional budget office confirmed that exceedingly few family farms and small businesses face the estate tax (http://www.cbpp.org/7-11-05tax.htm and http://www.cbo.gov/ftpdocs/65xx/doc6...-estatetax.pdf). the cbo report found that if the current exemption level of $2.0 million had been in place in 2000, only 123 farm estates and only 135 family-owned businesses nationwide would have owed any estate tax. the number of taxable farm estates drops to 65 nationwide at a $3.5 million exemption level, the level that takes effect in 2009. the number of taxable family-owned business estates falls to just 94 under the $3.5 million exemption.
    http://www.cbpp.org/pubs/estatetax.htm
  13. by   HM2VikingRN
    Quote from jolie
    if you want to talk about "tax fairness", you need to talk apples to apples. discussing income tax in the same breath as estate tax is deliberately misleading.

    estate taxes are nothing more than a thinly veiled money grab based on class envy. people who have worked, risked their assets, employed others, and paid taxes their entire lives, while still managing to build a family farm, business, or personal wealth have already paid their fair share. to penalize their estates and enrich the government at the expense of their rightful heirs is wrong.

    quit looking for more ill-gotten sources of revenue. start cutting spending.
    i will let bill gates sr speak to this point:

    bill gates, sr., a prominent advocate of the estate tax, explains, "the reason the estate tax makes so much sense is that there is a direct relationship between the net worth people have when they pass on and where they live. the government that protects their business activities, the traditions that enable them to rely on certain things happening, that's what creates capital and enables net worth to increase." (http://www.cbpp.org/6-1-06tax-transcript.pdf)
  14. by   HM2VikingRN
    It is quite easy for a lower income person to pay taxes that are greater on the margins than the very wealthy.

    1. Property Tax
    2. SS/Medicare tax 8.5% from dollar one earned in the year.
    3. Sales Tax-anywhere between 5-9% on almost every purchase in most states.
    4. Income tax.
    5. Gas and motor vehicle taxes.

    His argument is sound in that at lower incomes people are exposed to proportionately higher tax levels.

    See also:
    Today, more than 99 percent of estates pay no estate tax at all. Among the few estates that do owe taxes, the "effective" tax rate — that is, the percentage of the estate that is paid in taxes — averaged about 20 percent in 2005 (the latest year for which IRS data are available), far below the top estate tax rate of 48 percent that these estates faced.
    Why is the effective tax rate so much lower than the top tax rate? Estate taxes are due only on the portion of an estate’s value that exceeds the exemption level, not on the entire estate. For example, at today’s $2.0 million exemption level, a $2.5 million estate would owe estate taxes on $500,000 at most.
    Last edit by HM2VikingRN on Nov 19, '07

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