Buffett: The government has coddled me for too long

Berkshire Hathaway’s Warren Buffett has said the US government should immediately raise taxes on high earners to aid the economic recovery.

Writing in the New York Times, Buffett advised US policymakers to immediately raise taxes on income in excess of $1m, including dividends and capital gains, as well as levying an additional rate on those making $10m or more.

Buffett said his tax rate last year was lower than that of anyone else in his office of 20, in contrast to the 1980s and 1990s, when his rate was "in the middle of the pack".

Buffett said US legislators have a compulsion to protect the rich "as if we were spotted owls or some other endangered species" but suggested most of the top 500 earners "would not mind being told to pay more in taxes...particularly when so many of their fellow citizens are truly suffering".

The Berkshire Hathaway chairman also challenged the notion higher capital gains taxes would dissuade investors from entering the market.

"I have worked with investors for 60 years and I have yet to see anyone - not even when capital gains rates were 39.9% in 1976-77 - shy away from a sensible investment because of the tax rate on the potential gain", he said.

Buffett added Congress must achieve "far more" than its current aims of reducing the US deficit by $1.5trn over the next decade.

The first job, he said, is to "pare down future promises that even a rise America cannot fulfil. Big money must be saved here".

But he suggested the second task - addressing revenues - should ensure rates were left unchanged for 99.7% of taxpayers.