Now things are going to change as President Barack Obama will propose a “Buffett Tax” on people making more than $1 million a year as part of his deficit recommendations to Congress. Such a proposal, among suggestions to a congressional Super Committee expected to seek up to $3 trillion in deficit savings over 10 years, would appeal to his Democratic base ahead of the 2012 election but likely not raise much in revenues. White House Communications Director Dan Pfeiffer said in a tweet on Saturday the tax would act as “a kind of AMT” (Alternative Minimum Tax) aimed at ensuring millionaires pay at least as much tax as middle-class families.
Can India Impose Such a Tax
Now comes the turn of India to consider a tax on similar lines and we see that it will meet a stiff resistance. The sentiments are expressed by Ms Kiran Mazumdar Shaw Head of Biocon who has a different opinion and feels that Indians are already being taxed as per their income levels. As a result, people in the higher income brackets are paying anywhere between 30% to 50% of their income in the form of taxes. Things are very different in Europe where tax shelters help the rich in paying minimal amounts of tax. Plus, the countries there need larger funds to be able to invest in the countries' growth. This is not the case in India. The problem in India is not the quantum of funds raised through taxes. It is the appropriation of these funds. Most of the funds are siphoned into populist policies. A large part is lost to poor governance. The government needs reforms to correct these issues. Not to torture the people by raising tax rates.
Hats off to Warren Buffett for giving such a idea where he is an end loser but he is thinking off the organisation in the larger interest and at times after reaching a particular stage in life, one derives more pleasure by giving rather than receiving.