20110908

Extraordinary tax breaks? No, thank you.


No wonder Warren Buffett commands so much respect. Not only is he regarded as one of the world's most successful investors, but also he is a notable philanthropist who has pledged to donate 99 percent of his fortune and worked closely with Bill Gates to lobby other rich people to do the same. His sense of social responsibility is also second to none, as evidenced in his article that was recently published in the New York Times. In the article entitled Stop coddling the super-rich, he criticised the differential treatment the US Government gives the poor and the super-rich. Specifically, he slammed what he referred to as "extraordinary tax breaks" that the mega-rich people like himself enjoy. He pointed out that while the tax burdens of the middle class range from 33% to 41% and averaged 36%, the mega-rich pay income tax at a rate of 15%, and they do not need to pay any income tax. He also looked back to the 1980s and 1990s when tax rates for the rich were far higher. He said:

"According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends. I didn't refuse, nor did others."

Speaking on his own behalf as well as that of his rich friends, he said that most of them "wouldn't mind being told to pay more in taxes..., particularly when so many of their fellow citizens are truly suffering."

This is a true reflection of Mr Buffett's fairness, integrity and compassion. Contrast that with someone like Li Ka-shing, Hong Kong's super-rich tycoon who was branded as "superman" by those who worship him because of his wealth. Many years ago, Li threatened to reduce his investment in Hong Kong because of the "unrestrained attack" on him by the media and others after he and his business empire were linked with some scandals.

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