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Tax us more, say wealthy Europeans

Level 3 Advanced
1 Warmer
How would you describe the amount of tax you pay? (far) too much / about right / (far) too little What about the amount of tax that extremely rich people in your country pay? How would you describe that? Compare and justify your answers.

2 Key words
Write the key financial words from the article next to their definitions. public debt annual income assets taxable earning treasury tax return revenue well-off surtax inherited the wealthy capital wealth 1. the government department responsible for a countrys financial matters ___________________________ 2. rich, or having enough money to live well ___________________________ 3. things such as money or property that a person or company owns ___________________________ 4. given to someone when the previous owner (possibly a family member) died ___________________________ 5. money that a countrys government owes ___________________________ 6. people who have a large amount of money, land and other valuable things ___________________________ 7. the total value of an individuals income producing assets ___________________________ 8. the part of your income that you are required to pay tax on ___________________________ 9. an additional tax on something on which you already pay tax, especially a high income ____________________ 10. the amount of money you earn in a year ___________________________ 11. income from business activities or taxes ___________________________ 12. an official document on which you give details of your income so that the government can calculate the amount of tax that you have to pay ___________________________

Macmillan Publishers Ltd 2011 NEWS LESSONS / Tax us more, say wealthy Europeans / Advanced

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N T O FR BE C O DO O M W P W N IA EB LO B SI A L TE DE E D

Tax us more, say wealthy Europeans

Level 3 Advanced
3 Find the information
Scan the article and find information to complete the gaps in the table. name Warren Buffett nationality ___________________ source of wealth business investments other information paid $_____________ in tax in 2010 Frances _____________ woman one of a group of _____________ Germans in favour of a wealth tax proposed a _____________ on people in Italy who have an annual income of 510m

Liliane Bettencourt

___________________

LOral heiress

Dieter Lehmkuhl

___________________

probably ___________________

Luca di Montezemolo

___________________

___________________ of Ferrari

Macmillan Publishers Ltd 2011 NEWS LESSONS / Tax us more, say wealthy Europeans / Advanced

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N T O FR BE C O DO O M W P W N IA EB LO B SI A L TE DE E D

Tax us more, say wealthy Europeans

Level 3 Advanced
Tax us more, say wealthy Europeans
German group is the latest to volunteer for higher contributions, saying the country could raise 100 billion in two years with a 5% wealth tax 1 Helen Pidd in Berlin 29 August, 2011 First it was the American Warren Buffett announcing that he and his friends had been coddled long enough by a billionaire-friendly Congress. Then Liliane Bettencourt, Frances richest woman, who was at the centre of a tax scandal in 2010, signed a letter along with 15 other billionaires begging to make a special contribution to the treasury to help drag France out of the financial crisis. 10 3 Even an Italian got in on the action, with the boss of Ferrari saying that, as he was rich, it was only right that he stump up more cash. Now, as both France and Spain consider introducing a wealth tax, a group of 50 rich Germans have joined the tax me harder movement by renewing their open call to Angela Merkel to stop the gap between rich and poor getting even bigger. 9 8 On Monday, Lehmkuhl said he was renewing his call, first issued in 2009, to Merkels government to rethink its taxation policies. Currently, the richest Germans are taxed a maximum of 42%. The previous Chancellor, Gerhard Schrder, lowered the top tax rate from the 53% ceiling set by his predecessor, Helmut Kohl. I would say to Merkel that the answer to sorting out Germanys financial problems, our public debt, is not to bring in cuts, which will disproportionately hit poorer people, but to tax the wealthy more, said Lehmkuhl. We are always hearing about savings packages, but never tax rises. Yet tax increases are a way out of this mess. Thats where the money is: rich people. Something needs to be done to stop the gap between rich and poor getting even bigger. Under his groups plans, the new tax would only affect individuals with more than 500,000 in capital wealth. All money over that ceiling would initially be taxed at 5% for the first two years and thereafter at 1% or more. In France, Nicolas Sarkozy has proposed a similar idea: a temporary tax on the very rich. This would arrive in the form of an exceptional contribution of 3% on taxable earnings for those earning above 500,000. It will probably only last until 2013. In Italy, too, one of the countrys richest citizens has come forward to offer to pay more tax but only if Silvio Berlusconis government embarks on a wide-ranging programme of neo-liberal reform. Luca di Montezemolo, the multimillionaire Ferrari chairman, made his offer in an interview with the centre-left daily La Repubblica. Montezemolo, 63, said he wanted to see the government raise cash by means of property sales and reductions in the perks of Italys pampered politicians. You have to begin by asking it of those
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The German group is the latest manifestation of a feeling among some well-off individuals that the spare cash in their bank accounts might be able to ease, if not solve, the financial crises threatening 13 to cripple their countries. None of us are in Buffetts or Bettencourts league, said the founder, Dieter Lehmkuhl, a retired doctor with assets of 1.5m. Were a 14 broad church teachers, doctors, entrepreneurs. Most of our wealth is inherited. But we have more money than we need. The groups manifesto claims Germany could raise 100 billion if the richest paid a 5% wealth tax for two years. 15

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Tax us more, say wealthy Europeans

Level 3 Advanced
who have most, because it is scandalous that it should be asked of the middle class, he said. 16 He said that even before the concern over Italys giant public debt, he had proposed a surtax on annual incomes of between 5 million and 10 million. But it had met with a deafening silence. 20 17 In Spain, the socialist government is reported to be considering the reintroduction of a wealth tax scrapped in 2008. Experts say the tax on assets, not including a first residence, would produce upwards of 1 billion of revenue from just 50,000 rich individuals. In the US, Buffett has been mocked for his recent admission in The New York Times that he felt bad about only paying $6.9 million in tax in 2010, 17.4% of his taxable income, while his staff paid an average of 36%. 19 He suggested income and investment tax rates should be raised on those making more than $1 million in taxable income, 0.2% of people who filed tax returns in 2009. The article attracted fierce criticism. Warren Buffett, hypocrite, was the headline in the New York Post. Harvey Golub, former Chief Executive of American Express, told The Wall Street Journal: Before you ask for more tax money from me and others, raise the $2.2 trillion you already collect each year more fairly and spend it more wisely. Additional reporting by Angelique Chrisafis, John Hooper, Giles Tremlett and Dominic Rushe
Guardian News and Media 2011 First published in The Guardian, 29/08/11

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4 Comprehension check
What significance do these figures have in the article? eg. 15 50 1.5 million 5% 42% 3% 50,000 6.9 million 0.2% 2.2 trillion the number of other billionaires who signed a letter, along with Liliane Bettencourt, asking to pay a special contribution to the French treasury

Macmillan Publishers Ltd 2011 NEWS LESSONS / Tax us more, say wealthy Europeans / Advanced

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N T O FR BE C O DO O M W P W N IA EB LO B SI A L TE DE E D

Tax us more, say wealthy Europeans

Level 3 Advanced
5 Find the words
Find the following expressions in the article. 1. 2. 3. 4. 5. 6. to treat someone too kindly or protect them too much ___________________________________ (para 1) to give money, often without wanting to give it ___________________________________ (para 3) to damage something severely, or prevent it from working properly ___________________________________ (para 5) a serious failure to say or do something in reaction to a request or action ___________________________________ (para 16) to get rid of, or cancel, something ___________________________________ (para 17) be made to look stupid by being laughed at, or by someone saying something about you that is not kind ___________________________________ (para 18)

6 Discussion
Do you think that a wealth tax is the answer to the financial problems in Europe and the US? What other measures do you think should be introduced to ease the economic difficulties in these places?

7 Webquest
Go to www.forbes.com, roll your mouse over Lists in the menu bar and select Worlds Billionaires, then answer the questions below. Who are the wealthiest people in ... ... the world? ... the USA? ... Germany? ... France? ... Italy? ... Spain? ... your country? Where does their wealth come from? What nationality are they and where do they reside?

Macmillan Publishers Ltd 2011 NEWS LESSONS / Tax us more, say wealthy Europeans / Advanced

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N T O FR BE C O DO O M W P W N IA EB LO B SI A L TE DE E D

Tax us more, say wealthy Europeans

Level 3 Advanced KEY


2 Key words
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. treasury well-off assets inherited public debt the wealthy capital wealth taxable earnings surtax annual income revenue tax return

5 Find the words


1. 2. 3. 4. 5. 6. coddle someone stump up more cash cripple something a deafening silence scrap something be mocked for something

3 Find the information


name Warren Buffett Liliane Bettencourt Dieter Lehmkuhl Luca di Montezemolo nationality American French German source of wealth business investments LOral heiress probably mostly inherited chairman of Ferrari other information paid $6.9 million in tax in 2010 Frances richest woman one of a group of 50 (rich) Germans in favour of a wealth tax proposed a surtax on people in Italy who have an annual income of 5-10 million

Italian

4 Comprehension check
50 1.5 million 5% 42% 3% 50,000 6.9 million 0.2% 2.2 trillion A group of 50 rich Germans are asking for the richest to pay a wealth tax for two years. the value of the assets, in Euros, owned by Dieter Lehmkuhl the rate of wealth tax the German group are proposing the maximum rate the richest Germans are currently taxed at Sarkozy has proposed an exceptional contribution from the very rich of 3% on taxable earnings. The reintroduction of a Spanish wealth tax could bring 1 billion of revenue from just 50,000 rich individuals. the amount of tax, in US dollars, that Buffet paid in one year 0.2% of people in the US who filed tax returns in 2009 made more than $1m in taxable income. the amount in US dollars that the US government raises every year in taxes
N T O FR BE C O DO O M W P W N IA EB LO B SI A L TE DE E D

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