Bezos and Musk's Minuscule Taxes... Will It Trigger Wealth Tax Increase in the US? (Comprehensive)

Bezos Paid Only 1% and Warren Buffett 0.1% Taxes Over 5 Years (2014-2018)
US Investigative Media ProPublica Exposes Citing IRS Data
White House "Concerned About Data Leak... Wealth Tax Needed"

▲Jeff Bezos, Amazon Founder [Image Source=Reuters Yonhap News]

[Asia Economy New York=Correspondents Baek Jong-min and Kwon Jae-hee] It has been revealed that the top 25 billionaires in the United States, including Elon Musk, CEO of Tesla, paid far less income tax than ordinary workers. This has expanded into a major issue concerning tax fairness in the U.S., causing a significant stir. It is expected to give momentum to the wealth tax increase being pursued by the Biden administration.

On the 8th (local time), investigative news outlet ProPublica reported, citing unpublished data from the U.S. Internal Revenue Service (IRS), that Jeff Bezos, founder of Amazon and the world's richest person, increased his assets by $99 billion (about 110 trillion KRW) from 2014 to 2018, but paid only $973 million (about 1 trillion KRW) in federal income tax during the same period, which is less than 1% of the asset increase. ProPublica did not disclose the source of the information obtained.

Elon Musk, Tesla CEO and ranked number 2 among the wealthy, increased his assets by $13.9 billion (about 16 trillion KRW) during this period but paid only $455 million (about 500 billion KRW) in federal income tax, which corresponds to 3.27% of the asset increase. Warren Buffett, chairman of Berkshire Hathaway, saw his assets grow by $24.3 billion during the same period, but the actual tax paid was only $23.7 million, which is just 0.1% of the asset increase. Billionaire hedge fund investor George Soros did not pay federal income tax for three consecutive years from 2016 to 2018.

ProPublica pointed out, "The assets of the top 25 billionaires in the U.S. increased by $401 billion (about 448 trillion KRW) over the past five years, while the federal income tax they paid during this period was $13.6 billion (about 15 trillion KRW)," adding that "the effective tax rate is only 3.4%."

▲Billionaires in the United States [Image source=Yonhap News]

This is significantly lower compared to the 14% federal income tax paid by a median-income American household earning $70,000 (about 78 million KRW) annually. The contrast is even more striking when compared to the top tax rate of 37% applied to U.S. married couples filing jointly with combined incomes above $628,300 (about 700 million KRW).

Following this revelation, the U.S. Internal Revenue Service (IRS) launched an emergency response, stating it would investigate the circumstances surrounding the leak of confidential personal information. However, the issue continues to cause ripples in various aspects, including concerns over tax fairness and information leaks.

IRS Commissioner Charles Rettig addressed the Senate Finance Committee hearing, saying, "We fully understand the concerns of Americans regarding the disclosure of confidential information," and added, "We have begun an investigation to identify the cause of the information leak," attempting to contain the situation.

Billionaires have also openly expressed their discomfort.

Michael Bloomberg, former mayor of New York City, stated, "I donate about 75% of my income," and vowed, "I will use all means to hold those responsible for the tax information leak accountable."

▲Jen Psaki, White House Press Secretary [Image source=Yonhap News]

The White House expressed concerns about the information leak but also indicated that it demonstrated the necessity of a wealth tax increase.

White House Press Secretary Jen Psaki said at a briefing that "the unauthorized disclosure of government confidential information is illegal and a very serious issue," but added, "Greater efforts are needed to ensure that corporations and individuals bear a fair share of the burden."

Massachusetts Senator Elizabeth Warren, a strong supporter of the wealth tax increase, tweeted, "It is time for billionaires to finally pay their fair share."

Meanwhile, U.S. President Joe Biden has proposed a "wealth tax increase" to raise the top income tax rate from 37% to 39.6% to secure funding for infrastructure investments.

This content was produced with the assistance of AI translation services.