Will Buffett profit from the Buffett Rule?

pres589 wrote: In reply to SVreX: I wasn't backing up the $12k thing. Actually, now I am. Think about the other taxes that go into living. Sales tax for instance. Think of the percentage of income a person making $12k pays out in sales tax vs. a millionaire. Every situation is different but to pretend this is a black and white issue while only talking about income taxes and nothing else is disingenuous.

Think about how much more property tax a millionaire pays or the luxury tax on his high dollar car on top of the sales tax. You know, those taxes some one making 12k doesn't pay. And depending on where you live there is that special punishment tax on millionaires that no one making less has to pay.

In reply to ThePhranc:

Where did you get that B/H paid no taxes?

Berkshire Hathaway's 2010 Annual Report says they paid $5.607 Billion dollars in taxes, $3.538 Billion in 2009, and $1.978 Billion in 2008.

Follow the $5.6B link

Buffett says he paid $6,938,744 in personal income taxes in 2010.

Article written by Warren Buffett

pres589 wrote: In reply to SVreX: I wasn't backing up the $12k thing. Actually, now I am. Think about the other taxes that go into living. Sales tax for instance. Think of the percentage of income a person making $12k pays out in sales tax vs. a millionaire. Every situation is different but to pretend this is a black and white issue while only talking about income taxes and nothing else is disingenuous.

I agree with you that basic necessities consume more of a poor person's income than of a rich person's. That's why tax rates are graduated.

Doesn't change the basic facts- The rich do pay taxes, they pay more than the poor, and Warren Buffett will profit from tax increases because his wealthy customers will come flocking to B/H for tax shelters.

And Buffett will happily pay taxes on all those profits.

SVreX wrote: In reply to ThePhranc: Where did you get that B/H paid no taxes? Berkshire Hathaway's 2010 Annual Report says they paid $5.607 Billion dollars in taxes, $3.538 Billion in 2009, and $1.978 Billion in 2008. Follow the $5.6B link Buffett says he paid $6,938,744 in personal income taxes in 2010. Article written by Warren Buffett

http://www.nypost.com/p/news/opinion/editorials/warren_buffett_hypocrite_E3BsmJmeQVE38q2Woq9yjJ#ixzz1WRoIlYSf

Then there is net jet. http://dealbook.nytimes.com/2012/03/26/netjets-case-warren-buffett-and-taxes/

Buffet rule: one plate at a time

sorry, just had to lighten this up

SVreX wrote: I agree!

mguar wrote: Taxes on earning a million dollars plus per year should be more than the taxes earned on $12,000. per year..

Seriously? Where in the world does info like this come from? Got any links, calculations, basis, etc. for such an outlandish statement?

Seriously SVrex? It's a normative statement! How can you back up a normative statement with "links and calculations?" You guys are arguing about two different things, it's a pity that you don't realize it.

SVreX wrote:

"That's why tax rates are graduated."

Sales tax isn't graduated. Fuel taxes aren't graduated. Property taxes, etc etc etc. I don't think this is something that should be sugar coated or brushed aside.

The estimate that I saw on the Buffett Tax was something like $174Bil collected annually. And someone could call it a drop in the bucket, as has been done. But isn't a bucket of water just a collection of drops? Every bit has an impact and I'd like to see operations in the black and this moves the needle in that direction.

pres589 wrote: SVreX wrote: "That's why tax rates are graduated." Sales tax isn't graduated. Fuel taxes aren't graduated. Property taxes, etc etc etc. I don't think this is something that should be sugar coated or brushed aside. The estimate that I saw on the Buffett Tax was something like $174Bil collected annually. And someone could call it a drop in the bucket, as has been done. But isn't a bucket of water just a collection of drops? Every bit has an impact and I'd like to see operations in the black and this moves the needle in that direction.

These $12k a year people, how much do they get back every year in subsidies? I know that a $10 an hour worker who works full time for only 1/2 a year gets back more in income tax returns than they put in by about 50%.

Do you think the feds would be better off punishing the rich or not giving the money they confiscate to people who did nothing to deserve it?

ThePhranc wrote: Do you think the feds would be better off punishing the rich or not giving the money they confiscate to people who did nothing to deserve it?

You mean like the people who pay lower taxes since they don't actually earn their income? Say, via Capitol Gains- aka, un-earned income?

My issue is all about the capitol gains tax, which is paid PURELY via increase in the value of something when you sell it. Not about divedens. Not about profits, just the stuff that someone is willing to pay more for when you sell it.

So lets say that a guy name Ritt Momeny earns $24M in 2011 from selling stuff that he held onto over a year. Call it selling $250M of stuff when he bought it for $226M. Then theres a guy called Mallan Aullaly, who earns $24M from being paid to be the head of a big corporation who makes stuff, and their sales have gone up by billions, employ hundereds of thousands. Even Ritt has shares of this company that he was able to sell for more money over a year.

Since Ritt didn't actually do anything besides sell a whole bunch of stuff for more money- this paper stuff that really doesn't go to any company, but is traded 99% of the time, so companies don't profit from his owning.... Anyway, since he didn't earn it, we decide that he pays 15% tax on that- or $3.6M.

On the other hand since Mallan DID earn it, he gets to pay full 36% taxes on his earnings, which is $8.64M.

Basically, since Ritt has so much money sitting around, he can use it to pay a lot lower taxes than Mallan who has to actually work for it.

Is that how we want it to work?

That doesn't even consider the artificial inflation to markets that live off of capitol gains- say the stock market- which had a bubble, and the real estate market, which ALSO had a bubble. Shocking- the areas where you can earn money just by manipulating the value of it, AND pay less taxes on that earnings had bubbles. Maybe that's not so shocking afterall.

But here's what really kills me. People who work hard to earn their money, and suffer when markets collapse around them sit here and DEFEND the ones who's income is multiple orders of magnitude MORE than them. And think that they have earned this benefit. I personally think it idiotic that we give tax breaks to anyway of earning money, most particularly to the stock and real estate markets. They don't need a tax break. I don't get one. You probably don't get one for working. Why do they need it so badly?

If you want to cover dividens, we can talk about that- and how many times that is taxed. But giving a tax break since the value of a good you buy and sell (and probably never once put your hands on) since you held it for 366 days is just stupid.

www.fairtax.org

alfadriver wrote: ...But giving a tax break since the value of a good you buy and sell (and probably never once put your hands on) since you held it for 366 days is just stupid.

Not if you want that rich guy to make a long term investment in a company so you have a job to go to Monday morning. Most companies operate on credit, or to put it another way, rich guy's money. No credit, no business. No business, no jobs. No jobs, no taxes. Punishing the rich guy is what's stupid.

If I had Buffett's money, I'd be moving it overseas, parking it and waiting for this government to figure out exactly what the definition of fair is.

There is no fair until everyone pays taxes.

In reply to ThePhranc:

"Do you think the feds would be better off punishing the rich or not giving the money they confiscate to people who did nothing to deserve it? "

This is such a painfully loaded statement that it's really hard to take any of this too seriously.

pres589 wrote: In reply to ThePhranc: "Do you think the feds would be better off punishing the rich or not giving the money they confiscate to people who did nothing to deserve it? " This is such a painfully loaded statement that it's really hard to take any of this too seriously.

So you can't answer that honestly.

Any time anyone calls the IRS "thieves" or says their tax money was "confiscated" by the government, I cannot take them seriously, it's a farce and not a discussion at that point. I don't even know what you're trying to ask, or "ask", as the case may be.

In reply to alfadriver: So you do think its better to confiscate money and give it to people who didn't earn it.

pres589 wrote: Any time anyone calls the IRS "thieves" or says their tax money was "confiscated" by the government, I cannot take them seriously, it's a farce and not a discussion at that point. I don't even know what you're trying to ask, or "ask", as the case may be.

So you can't answer it honestly and have resorted to faking stupid claiming you don't even know what I'm trying to ask to avoid answering it honestly.

Do you need a shovel to dig your self any deeper?

Thieves: A person who steals another person's property.

Confiscated: Take or seize (someone's property) with authority.

Seems relevant to me.

Toyman01 wrote:

alfadriver wrote: ...But giving a tax break since the value of a good you buy and sell (and probably never once put your hands on) since you held it for 366 days is just stupid.

Not if you want that rich guy to make a long term investment in a company so you have a job to go to Monday morning. Most companies operate on credit, or to put it another way, rich guy's money. No credit, no business. No business, no jobs. No jobs, no taxes. Punishing the rich guy is what's stupid.

Do you seriously think that all the investment money goes to companies? Seriously? At least 95% of what happens is TRADES, where the company who is represented by the stock gets NOTHING. If I buy a Apple stock from you, Apple gets NOTHING.

I can see that we want to encourage investments into companies- and if we want that, lets change the rules. But at the moment, the ones who benefit the most are the ones who are lucky enough that the value they bought it from person X has increased when they sold it to trader Y.

As for the credit thing- that's an amusing one now- banks figured out how to bundle their loans so they could buy and sell them to traders, too- and people came up with inventive ideas so that one could even make an "investment" based on the rate of change of values, or on some kind of "insurance" on that bet.

And if you lose, you can count that to help your taxes over multiple years...

If I had Buffett's money, I'd be moving it overseas, parking it and waiting for this government to figure out exactly what the definition of fair is.

Where? Find me a country where the investment opportunites are anywhere near the US. I'm sure you are thinking China. Communist China. Did I say Communist? Or maybe Germany. Socialist Germany.

Maybe you think low tax haven Iceland or Ireland are a good place, but they collapsed worse than any country.

If you want to walk away from the country you live in, IMHO, just leave. Don't live here and pretend to want to be a member when you have all of your investments someplace else.

THen you go an be logical that we all pay a fair kind of tax.. Not a Fairtax, but fair tax.

ThePhranc wrote: In reply to alfadriver: So you do think its better to confiscate money and give it to people who didn't earn it.

There we go, change the subject! Well done! Have you applied to Fox? You should.

Whether you like it or not, it does take money to run a country.

And we already give money who don't earn it- Mitt Romeny didn't earn a penny, and he pays less tax than people who do, since he guessed the correct companies to own and sell.

alfadriver wrote:

ThePhranc wrote: In reply to alfadriver: So you do think its better to confiscate money and give it to people who didn't earn it.

There we go, change the subject! Well done! Have you applied to Fox? You should. Whether you like it or not, it does take money to run a country. And we already give money who don't earn it- Mitt Romeny didn't earn a penny, and he pays less tax than people who do, since he guessed the correct companies to own and sell.

All I did was put the question you couldn't answer into a statement because you couldn't answer the question you quoted. But thank you for the Fox quip it shows that in this subject you are an intellectual light weight who has to change the subject to avoid answering a question honestly.

Romney reaned that money by taking risks. Those investments could have also gone south and he would have lost that money.

I'll give you another question. You can avoid it, fail to answer it honestly like you're given to do or maybe you can actually be honest. I'm not betting on the honest part but here goes anyway.

How exactly does it help to run a country by confiscating money from successful people and giving to people who did nothing to earn it?

Now take your time and decide your action then take more to make sure you actually answer it honestly if you don't live down to expectations.

Honestly.. I make a few thousand a year in investments.. not enough to live on.. but enough that I can scrape by the lean times... I do not see why it should not be taxed at the same rate as my take home pay.

*edit due to annoyance

And Phranc.. knock of the personal attacks.. calling somebody an intellictual lightweight because they are either out of their area of expertise or do not feel like arguing with you does nothing but make you feel good and make everyone else hate you.

I didn't think this thread would go well when I started it.

Have there been any responses that were actually on-topic?

Sigh...

I was actually interested in responses to my original question. Don't give much of a hoot about the politics of it.

I know.. I have been staying out of these arguments.. we have people on this board who think they know it all and seem to enjoy arguing about it.

I just wanted the 5 minute argument.. not the full course

In reply to mad_machine:

Wasn't picking on you.

Especially since I am frequently the one who enjoys the 5 minute argument.

Is Buffett going to profit? Of course. The man has so much money, no matter what happens he's going to make a mint. Being on the inside, I'm sure he's got his loophole or two stuck in there just for him. If he wanted to pay more taxes than his secretary so badly, all he had to do is write them a check. I'm reasonably certain the government would be happy to accept it.

To Alfa, I get the feeling your idea of fair and mine are slightly different, like polar opposites. As far as where to park money, pick one. They want the investors, not their tax money.