Billionaire Warren Buffett would do anything to lower the tax rate of his company Berkshire Hathaway, including building unprofitable wind turbines to get federal government tax credits.
“I will do anything that is basically covered by the law to reduce Berkshire’s tax rate,” Buffett told an audience in Omaha, Nebraska this weekend. “For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”
The Wall Street Journal reported that investors made their way to Omaha to hear Buffett speak on “markets and the world.” Buffett made waves during President Obama’s re-election when the White House adopted the “Buffett Rule” as part of his campaign.
The infamous “Buffett Rule” would have the wealthy should pay a minimum tax of 30 percent. Obama invoked the rule against Republican challenger Mitt Romney repeatedly during the 2012 presidential race.
“So it was fascinating to hear Mr. Buffett explain that his real tax rule is to pay as little as possible, both personally and at the corporate level,” the WSJ notes.
Indeed, Buffett has invested billions of dollars into wind power in order to get federal subsidies. A subsidiary of the Buffett-owned MidAmerican Energy Holdings owns 1,267 wind turbines in the U.S. with a generating capacity of 2,285 megawatts. But once the company’s Wind VIII expansion is finished, MidAmerican will own 1,715 wind turbines with a generating capacity 3,335 megawatts.
Federal wind subsidies, called the Wind Production Tax Credit, paid wind power producers $23 per megawatt hour for the first 10 years of operation. The subsidy expired at the end of this year, but projects that broke ground last year can still get the generous 10-year subsidy.
Some Republicans and Democrats are working to bring back federal wind subsidies or to even make them a permanent feature of the tax code, along with other green energy subsidies. But there has been little progress on extending the Wind Production Tax Credit.
“Renewable energy supports thousands of jobs and generates billions of dollars in investment across the country,” said Iowa Republican Sen. Chuck Grassley in a statement. “Public policy continues to help renewable energy develop and generate electricity and fuel from natural resources. It’s good news for the economy and for energy diversity to restore these provisions.”
Iowa has become a major wind power state due to federal and state incentives. Many of the wind turbines owned by MidAmerican Energy are located in the state.
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