Berkshire Hathaway, the holding company of US billionaire investor Warren Buffett, received a stunning $29 billion check last year from the US government, thanks to a new tax law that massively lowered corporate tax rates.
In his much-anticipated annual letter to shareholders, Buffett explained that the company's net gain of $65.3 billion in 2017 was only partly due to his employees' efforts.
"Only $36 billion came from Berkshire's operations," he wrote. "The remaining $29 billion was delivered to us in December when Congress rewrote the US Tax Code."
Still, Buffett assured stockholders, "the $65 billion gain is nonetheless real - rest assured of that."
The new law, greatly touted by President Donald Trump, lowered the tax rate paid by US corporations from 35 percent to 21 percent, allowing many to undertake major new outlays and others to book significant fiscal gains.
"Buffett has been quick to say that he thinks that the tax policy changes were going to help Berkshire and be positive overall," said Bill Smead, chief executive of Smead Capital Management in Seattle, a Berkshire shareholder. "It is a bit ironic his candidate would not have any interest in this whatsoever."
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Buffett supported Hillary Clinton, a Democrat, in the 2016 U.S. presidential election. "Buffett doesn't dwell very long on the politics," Smead said.
Berkshire Hathaway wholly owns dozens of companies - from Dairy Queen to Duracell - and holds significant shares in large and diverse corporations including American Express, Apple, Bank of America, Charter Communications, Coca-Cola, Delta Air Lines, General Motors, Goldman Sachs, Moody's, Wells Fargo and Southwest Airlines.
Buffett's newsletters are read with intense interest on Wall Street and beyond. Known as the "Oracle of Omaha" - after his birthplace in the Midwestern state of Nebraska - he is one of the world's most successful investors and one of its richest men. Now 87, he has been investing since he first bought stock at the age of 11.
His latest newsletter reports that Berkshire's net earnings rose last year from $24.07 billion to $44.94 billion.
The year also saw the company's war chest swell to $116 billion in cash and US Treasury bills, financial manna that Buffett wants to use to make significant new acquisitions.
Tax changes by income
The company's often-impressive pace of acquisitions had slowed last year, he noted, when the prices asked for businesses "hit an all-time high," amid what he called "a purchasing frenzy."