They are all in the crosshairs, after the bombshell that spread in the US and around the world at the speed of light: the 25 American Scrooge Scrooge, or the 25 richest Americans – read among the most high-sounding names those of Jeff Bezos, Michael Bloomberg, Elon Musk, Warren Buffett, Carl Icahn and George Soros – paid a very small fraction of the federal taxes they were supposed to pay, in the period from 2014 to 2018. In some cases, they wouldn’t even pay. This is what emerges from the ProPublica association, which launched its bombshell report based on data from the US Revenue Agency, the IRS (Internal Revenue Service). The analysis showed that senior executives in corporate America paid federal taxes of just $ 13.6 billion over the period, in which their net worth – according to Forbes records – increased by $ 401 billion. The sum paid was equal, ProPublica calculated, to a real tax of just 3.4%. Strangely contrasted with the amount paid by average American families who, over the same period of time, earned about $ 70,000 annually, paying 14% of their income. Couples in the higher income brackets paid 37% on income above the value of $ 628,300. ProPublica was keen to remember that billionaires, unlike those who earn income above all from wages received at work, often benefit from “tax avoidance strategies beyond the reach of ordinary people”. In addition, their wealth is often linked to the increase in the value of the shares and real estate they hold, which are not considered taxable assets unless they are sold. The New York Times article that reports the news clearly writes: “The United States places emphasis on taxation of income from work, rather than taxation on wealth. And much of the wealth that the rich accumulate – such as shares in companies they manage, yachts and other investments – are not considered ‘taxable income’ unless (in fact) these assets are sold and earned. And even then, there are loopholes in the tax regime that can limit or cancel all taxes ”.
From the ProPublica article – titled “The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax”, written by Jesse Eisinger, Jeff Ernsthausen, and Paul Kiel, it appears that Buffett paid just 0.1%, or $ 23.7 million in tax, based on the association’s calculations, against $ 24 raised assets. 3 billion in the five-year period considered. During that time, Berkshire Hathaway’s CEO declared taxable income worth just $ 125 million. ProPublica noted that “none of the 25 richest Americans in the world have evaded taxes as well as Buffett.” A situation that has caused no small surprise: “this is perhaps something surprising, given that publicly the number one of Berkshire Hathaway has said he is in favor of higher taxes for the rich”.
Bezos, founder of Amazon and richest man in the world, paid less than 1% of the growth in his wealth, or $ 973 million, on a $ 99 billion increase in wealth over five years.
At that time, Bezos’ taxable income amounted to $ 4.22 billion.
So the ProPublica scoop article:
“Consider Bezos in 2007, one of the years he paid zero federal income taxes, with the Amazon stock more than doubling its value. Bezos’ fortune had jumped by $ 3.8 billion, according to Forbes, whose wealth estimates are widely quoted. How did a person enjoy such an increase in wealth and pay no income tax? ProPublica writes: “In that year (ie 2007) Bezos, who filed a joint tax return with his then wife MacKenzie Scott, declared a paltry (for him) $ 46 million income, largely derived from interest and from dividend payments on external investments. (Bezos) was able to offset every penny earned with losses from other investments and miscellaneous deductions, such as interest expense on debt and categories considered “other expenses”.
In 2011, when his assets were solid at $ 18 billion, Bezos filed a tax return showing that he had lost money, reporting income that was more than offset by the losses on his investments. Under the US tax rules, since he declared so little, he also applied for a $ 4,000 tax credit for his children, which he received ”(!!).
His tax avoidance – writes ProPublica – is even more impressive when you look at the period between 2006 and 2018: the wealth of the founder of Amazon, according to Forbes, increased by 127 billion, but he declares a total income of $ 6. , 5 billion. The federal taxes he paid were still substantial, amounting to $ 1.4 billion, but they amounted to a “true tax rate” of just 1.1 percent on the growth of his wealth.
Looking at the other Scrooge McDuck, regarding Elon Musk, the founder and CEO of Tesla, who declared a taxable income of $ 1.52 billion in those five years, paid no federal income tax in 2018; Michael Bloomberg, a former mayor of New York and founder of Bloomberg LP, paid a “true tax rate” of 1.3%, or $ 292 million, in the five years ProPublica considered. His real taxable income was $ 10 billion. The financier and philanthropist Soros did not pay federal income taxes between 2016 and 2018, as – according to his own spokesperson – in those years he had suffered losses on his investments “.