In his recent annual letter to shareholders, Warren Buffett, the 94-year-old CEO of Berkshire Hathaway, highlighted a significant milestone: the company’s record-breaking tax payment of $26.8 billion in 2024. This amount represents approximately 5% of the total corporate income taxes paid in the United States that year. Buffett emphasized the importance of responsible government spending and praised key leaders within the company for their contributions. The letter also touched on Berkshire's financial performance, including a substantial increase in cash reserves and strategic stock sales.

Buffett reflected on the dramatic transformation of Berkshire Hathaway since he took control in 1965, when the company paid no income tax. He described this as a concerning trend for established American corporations. Fast forward to 2024, Berkshire Hathaway became a leader in corporate taxation, paying an unprecedented sum of $26.8 billion. This figure underscores the company's growth and commitment to contributing to the national economy. Buffett urged policymakers to use this money wisely, particularly in addressing social issues like poverty. He warned against fiscal irresponsibility and emphasized the need for maintaining a stable currency.

The letter also commended Todd Combs, CEO of Geico, for turning around the insurer's performance. Under Combs' leadership, Geico saw its pre-tax underwriting earnings more than double to $7.8 billion last year. This success was attributed to higher premiums, lower claim frequencies, and improved operational efficiency. Buffett acknowledged that while there is still work to be done, the results were "spectacular." Additionally, Greg Abel, Buffett's planned successor, was praised for his decisive actions in capitalizing on investment opportunities.

Buffett noted that Berkshire's operating income surged by 27% to $47.4 billion in 2024, despite declines in earnings at over half of its operating businesses. The company engaged in significant stock trading, selling a net $134 billion worth of stocks throughout the year. Despite these transactions, Berkshire did not repurchase any shares in the fourth quarter, leading to a record cash pile of $334 billion by the end of December. Buffett explained that Berkshire's size necessitates careful planning for major financial moves, emphasizing the company's long-term approach to investments.

Buffett concluded by humorously acknowledging his limitations outside the realm of investing. He expressed gratitude for the ability to invest in great businesses, recognizing it as his primary strength. Through this letter, Buffett reinforced Berkshire Hathaway's commitment to financial responsibility and prudent management, while offering valuable insights into the company's operations and future direction.