The documents containing the tax records might have been obtained illegally and officials are investigating the matter.
A new report from ProPublica, an independent media outlet has shown that America’s ultrarich individuals pay less tax when compared to their actual wealth growth for years. According to the report, drawing on data obtained from the United States Internal Revenue Service (IRS), The 25 richest men in America have devised legal means to evade taxes or paid just a fraction of their taxable income spanning over decades.
The ProPublica report dwelt on the likes of Elon Musk, Jeff Bezos, Warren Buffett, Michael Bloomberg, George Soros, and Carl Icahn amongst others. To arrive at its claims that these homegrown billionaires pay less tax, the media outfit based the data of each person’s wealth on how much Forbes estimated their wealth grew in the same time period.
The report highlighted that in 2007, Jeff Bezos, who at the time was still growing his wealth paid no tax, a feat he managed to pull off again in 2011. Besides Bezos who now ranks as the world’s richest man, other America’s ultrarich, including Elon Musk, and Michael Bloomberg amongst others have also managed to evade paying tax at different times over the past decade.
A Deep Peak into America’s Ultrarich Tax Payments
ProPublica posited that the combined wealth of the billionaires it profiled grew by $401 billion from 2014 to 2018. With this growth, they all paid a combined tax of $13.6 billion for the 5-year period highlighted, amounting to a “true tax rate of only 3.4%.”
By comparison, the average American household with annual earnings of $70,000 paid as much as 14% in federal income taxes. At the peak of household revenue capped at $628,300, the tax payable comes in at 37%, a figure that implies the wealthy class is not paying their fair share in line with American tax ethics.
Per the data provided, Jeff Bezos grew his wealth by $99 billion from 2014 to 2018 with the total income reported coming in at $4.22 billion and taxes amounting to $973 million. Elon Musk, the CEO of electric automaker Tesla Inc (NASDAQ: TSLA) saw his wealth surge by $13.9 billion for the five years period. The total taxes paid by Musk was $455 million at a rate of 3.27% atop $1.52 billion total income reported.
Of all the billionaires profiled, ProPublica revealed no one paid less tax compared to Warren Buffett, whose true tax rate came in at 0.10%. The Sage of Omaha saw a $24.3 billion wealth growth and paid just $23.7 million in taxes, with a $125 million total income reported.
Each of these billionaires is notably justified in their low tax payment records as the majority of their assets is domiciled in real estate, and stocks. By current tax laws, these holdings are not taxable unless they are sold and income is made.
White House Growns at the Source of the Tax Data
Obviously, the source of the ProPublica publication was confidential IRS data which the White House appears to frown at. Press Secretary, Jen Psaki opined that the documents containing the tax records might have been obtained illegally and officials are investigating the matter.
“Any unauthorized disclosure of confidential government information by a person with access is illegal, and we take this very seriously,” Psaki told reporters at a news conference. “The IRS commissioner said today that they are taking all appropriate measures, including referring the matter to investigators and Treasury and the IRS are referring the matter to the office of the inspector general, the Treasury inspector general for tax administration, the FBI, and the US attorney’s office for the District of Columbia, all of whom have independent authority to investigate.”
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.