Warren Buffett's Tax Plan

The current tax policy in the United States is very confusing and it is very costly for our government to administer it. It is in the best interest of our country and its citizens to revise or replace our current tax policy.

Many people believe that because wealthy citizens have more money they are not paying their fair share in taxes; however, this is quite the opposite. According to an article by Jason Russell, he claims that the top one percent pay

The tax system in the United States has changed throughout the years, with many attempts to make it "fair" or "equal" while at the same time generating enough income for the United States government to thrive. It is a complex issue, and a controversial one at that. While it may not be possible for our tax system to ever be fair, it is important to make sure it doesn 't put more financial stress and pressure on one group than on another.

Rhetorical Precis In his essay “Stop Coddling the Super-Rich” (2011), Warren Buffett argues that “It’s time for our government to get serious about shared sacrifice” (qtd. in Weinstein 229). Buffett supports his assertion by arguing that rich people have low tax rates, statistics about his low tax rates over the previous years, and employees and middle class have high tax rates. His purpose is to make know about the government periodic low reduction of tax rates to the rich people in order that the government will make the wealthy Americans to have more contribution, high tax rates, and shared the same sacrifice like the American people.

Furthermore, Buffett provides his personal example that last year he paid the least percentages of taxes in his office. Buffett uses several precise data to show the difference. In the third paragraph, Buffett states, “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 inner office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent” (275). The exact numbers like 17.4%, 36% provide strong demonstration. From these two number we could easily find that Buffett, as one of the richest person in the world actually paid half percentage of taxes compare with his co-workers, who are all in middle class. Additionally, Buffett states, “The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically

Generally, the income earners pay less income tax and more payroll taxes while the high-end income earners pay more income tax and less payroll taxes. The low income earners however get credit benefits as the government pays for their payroll taxes. Therefore, the high income racket still suffers the burden of individual taxes. In 2014, the bottom 20% had an effective tax rate of -4.5% while the top 1% faced an average of 24.6% a margin of 29% creates a very huge economical gap between the rich and the poor. This only ends up hurting the economy more. As a result, I believe the highest effective tax that should be applied to the top 1% should not be more than 20%. If it goes beyond 20%, they shall start demanding for tax cuts and further design ways to evade the tax payments.

"Nearly all of the tax increases would fall on the top 1 percent," the Tax Policy Center report said. "The bottom 95 percent of taxpayers would see little or no change in their taxes."

After reading various articles about the Buffet Rule, I’ve become inclined to believe that it should not become legislation. My reasoning for this is that the overall idea behind the Buffet Rule is to close the gap between what middle-class workers pay in taxes and what those who make one-million or more pay in taxes, which, as Sahadi (2011) points out, may be more challenging than it sounds as it would require those high-earners to pay at least 30% of their income (Sahadi, 2011; Sahadi, 2015). The complexity of implementing the proposal comes from the variety of investing options available to those high earners and how to refine the benefits so that other areas of the economy are not negatively affected. The problem as I understand it would be how to tax investment incomes in a manner that is fair across the board, but also contribute to the 30% proposed by the Buffett Rule.

A) What is the possible meaning of the changes in stock price for GEICO and Berkshire Hathaway on the day of the acquisition announcement?

A) What is the possible meaning of the changes in stock price for GEICO and Berkshire Hathaway on the day of the acquisition announcement?

Tax system is a legal system of imposing and collecting taxes from the citizens of the country. As it has been stated by Albert Einstein, the hardest task in the world is to understand the tax system of a country. The United States’ tax system is so complicated that its tax code contains almost 3 million words and 6,000 pages. Moreover, the taxes implied by city and state governments add more complexity to the federal taxation system. In this case, we do not need to understand the complexity of tax code system in order to get acquainted with the significant role of taxes in American society.

The sixth point that Mr. Buffett disagreed with is diversification. To be honest, I would like to divide investors into two groups, one is big and the other is small. For a small investor, diversification would undoubtedly cost so much that it is better to concentrate on one or two stocks. Nevertheless, it would be more terrific for a big investor to diversify not only because of reducing the firm-specific risk, but also the market risk by investing stocks with correlation not equal to one. Hence, this statement still remains some questions. Nevertheless, if we look the investments of Berkshire Hathaway, it does diversify its business in insurance, apparel, building products, finance and even flight

On May 24, 2005, Warren E. Buffett, the chairperson and chief executive officer (CEO) of Berkshire Hathaway Inc., announced that MidAmerican Energy Holdings Company, a subsidiary of Berkshire Hathaway, would acquire the electric utility PacifiCorp. In Buffett’s largest deal since 1998, and the second largest of his entire career, MidAmerican would purchase PacifiCorp from its parent, Scottish Power plc, for $5.1 billion in cash and $4.3 billion in liabilities and preferred stock. “The energy sector has long interested us, and this is the right fit,” Buffett said. At the announcement, Berkshire Hathaway’s Class A shares closed up 2.4% for the day, for a gain in market value of $2.55

At first, Mr. Warren E. Buffett said that their operating and capital-allocation process would not be affected by accounting numbers such as financial statement and any consolidated numbers. The book also says the accounting reality is restricted by the generally accepted accounting principles, GAAP, so that some intangible assets

One of the obvious reasons to raise the taxes of the rich would be because they simply earn more. One example is if two people started the year off with fifty thousand but then let us say one had a rich family member that died and they had received millions through a will, then say they received a gift of one billion by the end of the year they pay the same taxes even though one of they are now a billionaire (Cohen). The reason is that the government does not tax on gifts or wills so then they would not have to pay more taxes if they received a gift that had consisted of a large sum of cash (Cohen). Now there is a large chunk of change out of circulation and now the middle/lower