When the facts change, I change my mind. What do you do? -- John Maynard Keynes

Saturday, September 6, 2014

Warren Buffett, Burger King, Tax Avoidance

Despite his public pose as an advocate for higher tax payments, Warren Buffett is remarkably good at minimizing them for Berkshire Hathaway. He recently cashed out his investment in Graham Holdings, former owner of the Washington Post, by executing a tax-free swap of assets... follow the man's money. In May 2010 Barron's magazine reported that Mr. Buffett "groused about a tax bill of roughly $1 billion that Kraft incurred by selling its pizza business to Nestlé, the world's largest food concern, for $3.7 billion, to raise additional funds. 'Dumb' was Buffett's word of choice.(source infra)

What's good for the goose, is good for the gander?

Warren Buffett's Tax Whopper - WSJ: ".... The real tax gain for Burger King is that by choosing a legal address in Canada it can avoid Washington's obsession with taxing overseas profits at American tax rates. To the extent that either chain is able to grow internationally, this deal means that their world-wide earnings, once taxed overseas, generally won't have to be taxed again for the privilege of being invested in the U.S. The business case seems clear, but the politics can be difficult. Senate Democrats, desperate to avoid discussing Iraq or ObamaCare, are hoping to hold the Senate by running against "Benedict Arnold" corporations instead of real-life Republican opponents. But it looks like Democrats will now have a harder time having it their way—unless they want to stage a political inversion and turn on their most famous benefactor and supposed tax expert... Mr. Buffett is no doubt aware of the tax implications of this deal, as he always is when investing his fellow shareholders' money...."

The Big Picture

Financial Crisis - The Telegraph

JohnTheCrowd.com | The Sailing Website

Craig Newmark - craigconnects