Alex Crippen is an Executive Producer at CNBC and CNBC.com. He holds a
degree in economics from Wesleyan University. He writes a summary of an
interview given to Becky Quick (and Joe Kernan via remote) on CNBC's Squawk Box:
Buffett on Taxes
... On taxes, Buffett says it's a myth that U.S.
corporations are paying anything close to a 35 percent tax rate and
maintains those taxes are not "strangling" American competitiveness. He
dismisses suggestions by critics that if he wants the super-rich to be taxed
at a higher rate then he should write a check and make a voluntary donation
to the Treasury. Buffett responds that contributions aren't going to solve
the massive debt problem facing the U.S.
... He says it is a "travesty" that everyone else is
being asked to make sacrifices but not America's most wealthy people.
... While he would accept Joe Kernen's suggestion for a
tax on a person's total wealth, he says he doesn't think that's the best way
to go, in part because it's hard to value assets like farms. ...
2-4-8 Response: Buffett on Wealth Tax
It is very big news to learn that Warren Buffet, “would accept Joe Kernen's
suggestion for a tax on a person's total wealthâ€. I sponsor
www.TaxNetWealth.com which advocates a broad tax base by taxing individual
and foreign-owned net wealth at 2% (above a $15,000 exemption), retail sales
at 4% and income at 8%. It would yield $2.6 trillion – ($400 billion more
than FY 2010 federal revenue).
Rich and poor would pay the same tax rate. Event-based taxes from
capital gains, estate and gift taxes would not be necessary. The concurrent
elimination of payroll taxes for Medicare and social security (-to be funded
from general funds) and a significant reduction of the corporate income tax
rate to 8% should merit near universal support of the 2-4-8 Tax Blend from
social liberals and business conservatives alike.
Corporations would feel less of a need to influence politicians once tax
incentives are off the table. How would an 8% corporate income tax affect
jobs and the economy? Those answers are better left to your talents and
dreams for a brighter future.
Eugene Patrick Devany, JD, MPA
Note: The above response is brief due to the 1100 character
limitation on CNBC.com. I believe Mr. Buffett's position was forshowed in Ralph
Nader's book, Only the Super-Rich Can Save Us.
After the article was published CNBC published
the transcript of the show which includes the following sections in regard
to wealth:
BUFFETT: We have a healthy economy except for
housing, but housing is such a big factor. Housing was 22 trillion or so of
America's 60 trillion of wealth a few years back. And when that goes— gets
whacked and is held on leverage with mortgages ...
JOE: Because that's how these — that's how these
people are — to just like put a, what do you, like a surtax or something,
that — or we can do that. I've asked you why can't we just tax you at 10
percent of your wealth and that didn't go over very well. If you had a 10
percent of all this wealth would bring in quite a bit of money, too. We'd
get — I figure we get about 5 billion from you alone, right?
BUFFETT: Yeah, that's true and actually, you
know, it's been — wealth tax is tough to enforce. I mean, very hard to say
what, you know, what every farm is worth or you know, every business,
private business is worth. I don't — I don't particularly favor a wealth
tax, but I would not — I would have no objection to it. I mean, if 10
percent of my wealth and 10 percent of everybody's wealth went to the
government, I don't think that's the best system, but...
Later in the day there was a blog in the Wall
Street Journal about Mr. Buffett's comments on housing which resulted in a
further 2-4-8 Response:
On CNBC Mr. Buffett said, "We have a healthy economy
except for housing, but housing is such a big factor. Housing was 22
trillion or so of America's 60 trillion of wealth a few years back. And when
that goes— gets whacked and is held on leverage with mortgages ..." In the
same interview he said that he would buy up millions of single family homes
if he could and further said he is open to a net wealth tax. This fox knows
that the housing market (and his investments) would rebound if mortgage
principal were used to offset assets in computing a net wealth tax and
income tax rates were reduced to permit real saving. A wealth tax would be a
much better boost for housing than the mortgage interest deduction on the
income tax. Many politicians and economists are seriously considering the
2-4-8 Tax Blend. ...
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