Warren Buffett was on Bloomberg TV earlier today talking taxes and politics. In case you missed it, Mitt Romney announced that he paid ~15% on his taxes. This is because most of the money came from capital gains at Bain Capital. Due to ridiculous legislation, hedge fund and private equity managers, are taxed capital gains at 15% instead of the normal income tax rate.
Buffett, who is a big Obama fan, actually defended Romney. He thinks its the poor laws” fault not Romney’s.
Below is a brief excerpt followed by link to full document:
Warren Buffett, the billionaire calling for more taxes on the rich, said Mitt Romney’s U.S. rate of about 15 percent reflects poor laws rather than failings by the candidate for the Republican presidential nomination.
“It’s the wrong policy to have,” Buffett told Bloomberg Television’s Betty Liu in an interview today. “He’s not going to pay more than the law requires, and I don’t fault him for that in the least. But I do fault a law that allows him and me earning enormous sums to pay overall federal taxes at a rate that’s about half what the average person in my office pays.”
Buffett, chairman and chief executive officer of Berkshire Hathaway Inc. (BRK/A), supports Democratic President Barack Obama and said Congress needs to raise taxes on the wealthiest Americans to close the budget deficit. Romney has agreed to release his 2010 tax return tomorrow, under pressure from Republican opponents, after saying he pays about 15 percent. Romney co- founded Boston-based private-equity firm Bain Capital LLC.
“He makes his money the same way I make my money,” said Buffett, 81. “He makes money by moving around big bucks, not by straining his back or going to work and cleaning toilets or whatever it may be. He makes it shoving around money.”
Romney, a multimillionaire, reversed course and promised to speed up the release his tax disclosures after being dogged by questions during the South Carolina primary campaign. Former House Speaker Newt Gingrich, one of Romney’s rivals for the nomination, earned $3.1 million in 2010 and paid an effective federal tax rate of about 32 percent, returns released by the candidate on Jan. 19 show. In a debate that day, Gingrich called on Romney to be more forthcoming.