Billionaire investor Warren Buffett made big headlines last years when he wrote a piece in the New York Times saying it was time for the American government to start taxing the rich. It was important because he was dead right.,
How then do we explain this story in Bloomberg that NetJets Inc, a private jet-sharing company owned by Warren Buffett's Berkshire Hathaway is being sued for $366.3 million by the government to recover unpaid taxes. NetJets in November sued the U.S., saying the federal government had wrongly imposed taxes, interest and penalties totaling more than $642.7 million but the US government has rejected the claims and instead counter-sued, claiming that NetJets Aviation Inc. owes more than $302.1 million, another unit, NetJets International, is liable for $52.9 million, and Executive Jet Management Inc. owes $10 million while NetJets Large Aircraft owes $1.19 million.
In his letter to shareholders last year, Buffett said NetJets has long been an operational success, owning a market share five times that of its nearest competitor. "NetJets earned $207 million pre-tax in 2010, a swing of $918 million from 2009 … quick restructuring of management and the company's rationalization of its purchasing and spending policies has ended the hemorrhaging of cash and turned what was Berkshire's only major business problem into a solidly profitable operation."