Labor's 'Warren Buffet' Rule Draws Joe Hockey's Interest

Treasurer Joe Hockey said that he is willing to consider an Australian version of the "Buffet Rule" that was proposed at the ALP National Conference on Friday. But he expressed concerns over the tax figures, showing that the richest of Australians already pay a huge amount of tax and setting a minimum tax rate for the high income groups might encourage them to move overseas.

Buffet rule, named after American billionaire Warren Buffet, brings the highest income earners of a nation under the compulsion of paying a minimum rate of tax. Hockey told ABC Radio on Monday that he was looking for more detailed information on the subject from Anthony Albanese, a Labor frontbencher. Albanese had been able to assert successfully that a future Labor government might need to consider the rule at the minimum.

"Fifty per cent of all income tax in Australia is paid by 10 per cent of the working population," he said. "If you don't get the formula right, you are going to see mobility in that 10 per cent of the workforce where they can go and work overseas in a way that our parents and grandparents could never have imagined." The Financial Review reported Hockey saying Labor has six years in government to work out a plausible plan for implementing the rule but he said is "happy to look at it" nonetheless.

According to the NT News, as many as 75 Australians earning $1 million on a yearly basis haven’t paid tax, a recent Australian Taxation Office figures revealed. Hockey pointed out that 50 percent of the income tax is paid by the 10 percent of the working class and if the tax rates are not worked out according to the right formula then the country might have to see most of these high income earners move overseas. Hockey further added that it is more of a balancing act that should ensure that the tax system is fair while maintaining Australia’s competency against other countries.

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