On December 13, Musk was named "Person of the Year" by Time magazine, but U.S. Senator Elizabeth Warren expressed her strong dissatisfaction with the matter. Warren believes that Musk does not pay taxes and is a prostitute. Warren tweeted: "Let's change the tax laws that are manipulated so that the man of the year can really pay taxes and no longer be a prostitute from other people." ”
Not only that, Musk also shared a new cover of Time magazine produced by the American Tax Fairness Association, with a photo of Musk on the cover with the words "Tax me" in large letters, along with a few lines of text saying that Musk paid $0 in federal income tax in 2018, his average effective tax rate was only 3.27%, and his wealth exploded by $240 billion during the epidemic, most of which will be tax-free.
In response, the "earth-shattering" Musk responded: "You remind me of when I was a child, my friend's angry mother would yell at everyone for no reason. ”
In fact, in the United States, the richer people are, the more stingy they are when it comes to paying taxes. Can you imagine that American billionaires pay less taxes than the average wage earner?
ProPublica, an independent news investigative agency in the United States, has come up with an incredible answer by investigating the IRS's secret information: Billionaires like Bezos, Musk, and Buffett pay income taxes that are simply not worth anything compared to the wealth they acquire, and sometimes they don't even pay a penny.
That's right, in 2007, Bezos, already a billionaire, didn't pay a penny of federal income tax. In 2011, Bezos once again realized this incredible "fact.".
At that time, President Biden had a "revival dream" of infrastructure construction, and in the face of huge financial expenditures, he thought of paying taxes to a large number of rich people represented by Musk to fill the "hole". All sectors of American society can't stand these rich and oily people, and they have proposed to make the rich pay more taxes.
On October 27, U.S. Senate Treasury Committee Chairman Ron Wyden unveiled a tax proposal that would impose a "billionaire income tax."
Of course, Musk who heard this news could not sit still, Musk believed that even if all the money was given to the government, the government would not be able to use the money rationally, it would only be wasted, far more wise than letting them distribute it themselves.
Dissatisfaction turned to dissatisfaction, and Musk had to "obediently" face more than $15 billion in tax bills after complaining. Just last month, Musk sold shares on a massive scale. Musk said he paid taxes by selling the shares to prevent being told that he was avoiding taxes.
In Musk's words, "I'm not getting a cash salary or bonus from anywhere." I only have stocks, so my only way to personally pay taxes is to sell stocks. ”
Do you think Musk really took this money to pay taxes? Not quite, although he sold a large number of shares, he currently owns 564,000 more Tesla shares than before the sale.
As Tesla's founder, Musk has the power to exercise options to buy more of Tesla's stock, which means he can buy or sell Tesla's stock at a fixed price.
Musk, on the other hand, poured the cash from the sale of the stock into more "cheap" stocks. Musk bought a large number of stocks at an ultra-cheap exercise price of $6.24 per share, and what is the value of Tesla stock in December 2021? Around $900 to $1,000. Since Nov. 6, Musk has exercised an option to buy 10.7 million shares of Tesla stock. He bought the stock at a price well below 1% of Tesla's current share price, and Musk doesn't seem to care about the tax issue.
In the United States, every penny earned by the people, that is, their wages, is subject to a certain percentage of income tax to the federal government. Why does U.S. taxation, which has always put fairness first, fail when it comes to the rich?
Musk said he didn't get paid in cash from anywhere, not surprisingly, this phenomenon often happens to the super-rich. Between them, there has always been a strange competition: than who pays less.
When Jobs returned to Apple in the 1990s, his salary was $1. Bezos' annual salary is only $80,000. This is not to say that they work hard and do not expect anything in return, and this is exactly the means by which they avoid taxes. It should be known that the tax rate of wages can be much more than other tax rates such as stocks and bonds, and by reducing wages, the high taxes and fees that originally need to be paid have been reduced.
They have taken advantage of legal loopholes and legal ways to "perfectly" avoid taxes again and again, but the US government has no way to do anything. It seems that the US tax system should be changed.