‘Financial tips’ allow the world’s two richest people Jeff Bezos and Elon Musk to pay almost no income tax

Tram Ho

Most people know the super-rich pay taxes as a percentage of their wealth, and this is far less than the average hard-working person. But a new report from ProPublica suggests the disparity may be larger than imagined. ProPublica is a New York-based nonprofit that produces investigative journalism content for the public interest.

According to the report, Jeff Bezos, Mark Zuckerberg and Elon Musk, along with many other super-billionaires like George Soros and Warren Buffett, have built their fortunes in the billions while paying almost no federal taxes. Their method is salary structure to avoid having a huge income.

ProPublica says no activity is illegal. However, tax filings reveal how the super-rich minimized their taxes, sometimes by borrowing money using their stocks as collateral. By comparison, salaried people live primarily on wages, which are taxed as income.

The 25 richest people in the US have amassed a fortune of $1.1 trillion as of 2018, according to ProPublica’s analysis of tax filings. And this amount is equivalent to the assets of 14.3 million average wage earners in the US. And these salaried workers will have to pay about $143 billion in taxes, 75 times more than the $1.9 billion paid by the 25 wealthiest Americans in 2018.

Tech CEOs did not immediately respond to requests for comment, nor did they reach out to ProPublica for comment. Elon Musk alone is said to have responded to an initial inquiry with a “?”.

Jeff Bezos

Mẹo tài chính cho phép hai người giàu nhất thế giới Jeff Bezos và Elon Musk gần như không phải trả thuế thu nhập - Ảnh 1.

The Amazon boss is said to have paid no federal income tax in two separate years, 2007 and 2011. In 2007, Bezos’ fortune increased by $3.8 billion according to figures from Forbes, but he (legally) management) reported earnings of just $46 million. And then he offset that income with losses from investments and tax deductions, resulting in zero taxable income, ProPublica said.

Between 2006 and 2018, Bezos’ fortune reportedly increased by $127 billion, but his total reported income over that 13-year period was $6.5 billion, with a cumulative tax bill of $1. $ ,4 billion. That works out to a tax rate of about 21% on reported income, or 1.1% on total assets.

According to ProPublica, Bezos’ average-age salaried employees pay more in federal income taxes than their average wealth has grown over the course of 13 years.

Amazon did not respond to a request for comment.

Elon Musk

The boss of two popular companies Tesla and SpaceX also reportedly paid no federal income tax in 2018, according to ProPublica. The newspaper also reported that the Tesla CEO paid $68,000 in federal income taxes in 2015 and $65,000 in 2017.

Mẹo tài chính cho phép hai người giàu nhất thế giới Jeff Bezos và Elon Musk gần như không phải trả thuế thu nhập - Ảnh 2.

A chart accompanying the story shows that Musk’s fortune grew by $13.9 billion in the five years from 2014 to 2018. But he reported $1.52 billion in income and $455 million in taxes. compared to the same period.

And Elon Musk has used Tesla stock as collateral for personal loans, a strategy adopted by many rich people.

Elon Musk and Tesla did not immediately respond to requests for comment.

How is wealth not taxed?

In the United States, the federal government taxes only “income,” which includes wages, stock dividends, bond interest, and proceeds from the sale of financial instruments. As a result, when a billionaire holds stocks that have skyrocketed in value, that wealth is not taxed in its own right.

Like Musk did, the wealthy can still extract value from company shares without selling them, by using them as collateral for loans. Money from loans is not taxed because they must be returned to the lender.

Super-rich investor Warren Buffett says he believes tax laws in the US must be reformed, though he is also using measures to keep his taxes low relative to his personal wealth. . Buffett has repeatedly called the current tax system part of a “class war” and declared, “my class has won.”

Refer to Cnet

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Source : Genk