Blackstone Group LP Chief Executive Stephen Schwarzman called Wednesday for a flat tax in the United States to create an "inherent sense of fairness," according to an interview he gave on CNBC.
Schwarzman, who became a billionaire building up and taking public the private equity firm, said confidence in the country "has been strained to broken" and the United States needed to be "relaunched."
Schwarzman told CNBC his personal tax rate is 53 percent, which he said was 36 percent federal and 17 percent state and local, and described it as "one of the highest tax rates actually in the world."
"I think tax reform is an important issue ... Everyone is going to be giving up something," he said. "In terms of tax reform, one way to get to a satisfactory resolution is actually to have a flat tax. Whether you have one level of flat tax or two levels of flat tax, or a higher one for people who earn more, or a lower one for people who earn less, you have to have an inherent sense of fairness."
Schwarzman said, while he did not feel "undertaxed," people need to feel they are getting the same treatment as their neighbor.
"If some people are left out and some people have special deals, it doesn't feel like the kind of situation where everyone's going to get on board," he said.
A long fight over debt and deficits ended in early August with a deal that averted a national default, but dented America's stature as the world's economic superpower and failed to stave off the first U.S. credit downgrade.
Round two comes this month when Democrats and Republicans begin to negotiate what should be included in a deficit-reduction package that must contain at least $1.2 trillion in savings. Obama wants higher taxes to be part of the package. The Republicans, driven by Tea Party conservatives in their ranks, are demanding spending cuts with no new taxes.
Billionaire Warren Buffett, chairman of conglomerate Berkshire Hathaway Inc, recently called for higher taxes for the rich, arguing the wealthy had been "coddled long enough by a billionaire-friendly Congress."
Buffett said his federal tax bill last year was $6,938,744, the equivalent of 64 shares of Berkshire Class A stock.
"That sounds like a lot of money," Buffett said in August in the New York Times. "But what I paid was only 17.4 percent of my taxable income -- and that's actually a lower percentage than was paid by any of the other 20 people in our office."
© 2017 Thomson/Reuters. All rights reserved.