The wealthiest Americans, including Elon Musk and Jeff Bezos, did not pay income tax | Business news
President Joe Biden faces calls to introduce a wealth tax after a report alleged that America’s richest executives, including Amazon’s Elon Musk and Jeff Bezos, avoided paying income taxes – some for several years.
ProPublica, the nonprofit investigative journalism organization, said its results showed that tax burdens are particularly low compared to their growing wealth and other assets.
It calculated that the wealth of the 25 richest Americans combined grew by $ 401 billion (£ 283 billion) from 2014 to 2018.
They paid $ 13.6 billion (£ 9.6 billion) in federal income taxes over those years – that’s just 3.4% of the increase in their total wealth, according to ProPublica.
This is due to tax strategies that are perfectly legal.
Tax avoidance measures can include a cut for charitable giving or waiving wages – taxed up to 37% – and instead benefiting primarily from capital gains at a customary lower rate of 20%.
The report claimed that Amazon founder and outgoing CEO Jeff Bezos paid no income tax at all in 2007 and 2011.
It was the same for Tesla and Space-X founder Elon Musk in 2018.
Analysis showed that financier George Soros – known by some as the man who broke the Bank of England on a short sale on sterling that grossed him $ 1 billion in 1992 – did not pay federal income tax for three consecutive years.
A spokesman for Mr Soros, who has supported higher taxes for the rich, told ProPublica that he lost money on his investments from 2016 to 2018 and therefore does not owe federal income tax for those years.
Mr Musk, the AP news agency reported, responded to ProPublica’s first request for comment with a punctuation mark “?”.
The American tax system is more strained as Mr Biden goes on a number of buying frenzies, including a massive one $ 2.3 trillion infrastructure program, at a time when government borrowing has skyrocketed to the COVID-19 Pandemic.
Democratic supporters used the ProPublica papers’ release to urge the president to introduce a wealth tax rather than inflicting more financial pain on ordinary households.
Senators Elizabeth Warren and Bernie Sanders are among the cheerleaders.
Ms. Warren tweeted Tuesday, “Our tax system is rigged for billionaires who don’t make their fortune from income like working families do.
“The evidence is absolutely clear: it’s time for a #WealthTax in America so that the ultra-rich finally pay their fair share.”
Mr Biden previously ordered crackdown on offshore tax evasion after it is estimated that the US government is losing up to $ 120 billion annually to individuals and companies who defraud the system.
However, earlier in the day at a hearing for the Senate Finance Committee, IRS Commissioner Charles Rettig announced that his team was “inferior” on enforcement.
The G7 group of wealthy democracies, which includes the United States and Britain, has agreed to: a global minimum corporate tax rate of at least 15% to deter multinational corporations from avoiding taxes by investing profits in low-interest countries.