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Warren Buffet's Taxes

Recorded on October 12, 2011

From The Heritage Foundation, I'm Ernest Istook.

Billionaire Warren Buffet has told us about his taxes.

Last year he made almost $63-million, and paid just under $7-million in federal income tax—about 17.4%.  How did he avoid a 35% tax rate?  By giving away about $22-million to charity, thus lowering his taxable income.

Buffett gets a lower tax rate than his secretary by giving away money.  So would Obama's plan for higher taxes on the rich wipe out major gifts to charities—like churches, feed the children programs, and the Red Cross?  If Uncle Sam got the money instead, would it be better spent?

That's not exactly a sinister loophole like President Obama claims the rich are exploiting.

And Buffett's taxes are higher than he makes it sound.  The IRS says his company, Berkshire Hathaway, owes a billion dollars in back taxes—and Buffet is fighting not to pay that.

From The Heritage Foundation, I'm Ernest Istook.