Thursday, August 18, 2011

Warren Buffet, taxes and Silex

Warren Buffet's opinion piece in the New York Times "Stop coddling the super-rich" must provide ammunition for those who argue that raising taxes for the richest is the right way to start paying back the crippling US debt.
Buffet says "The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot." and further comments "I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off."
This sounds remarkably like sense. 
I noticed also today that Silex, the only solar panel producer in Australia, is stopping production and axing jobs. Direct Action at its best perhaps?
With the axing of the generous Feed-In Tarrif in NSW and the capping of the Net Feed-In Tarrif in Victoria, this will place a large number of jobs in peril. Will the politicians travel up and down the length of Australia and butcher this as well?
It's just this boom and bust mentality that has ruined ongoing and sustained investment in renewable energy technologies and jobs in Australia. Hence the need for something like a carbon tax which shifts the investment decisions away from government to those best placed to decide them, the entrepreneurial business.



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