America’s 25 richest people allegedly paid a “true tax rate” of just 3.4% between 2014 and 2018 according to leaked data from the Internal Revenue Service (IRS), compared to the 14% paid by the median American household and the 37% rate currently paid by those on incomes of $523,600 (£376k) or more.
The statistics were revealed by ProPublica, after the non-profit news organisation calculated “true tax rates” by comparing federal income tax paid by each billionaire between 2014 and 2018 to their respective change in net worth over the same period, as recorded by Forbes. The 25 billionaires, including investment firm Berkshire Hathaway's founder Warren Buffett and Tesla CEO Elon Musk, saw their collective wealth increase by $401 billion (£288bn) over those five years, but between them they only paid $13.6 billion (£9.8bn) in federal income taxes. Click or scroll throught to find out more about the investigation and the super-rich who want to pay MORE tax.
The ProPublica investigation also alleged that the world’s richest man and founder of Amazon, Jeff Bezos, didn’t pay a single penny in federal taxes in 2007, despite already being a billionaire at the time. Bezos had another tax-free year in 2011, by which point he had accumulated an impressive fortune of $18 billion (£11.1bn), and he even received a $4,000 (£2.5k) bonus in tax credits for his children. The e-commerce mogul paid a “true tax rate” of just 0.98% between 2014 and 2018. Former New York City Mayor Michael Bloomberg, George Soros, and investor Carl Icahn also feature on the list of billionaires who paid puny taxes, although Buffett and Bloomberg have spent years campaigning for higher tax rates – look out for them later in this round-up.
These billionaires haven’t engaged in any illegal activities to avoid tax, but the data does highlight possible flaws in the American taxation system which allow the mega-rich to pay so little.
President Biden is looking to tackle this by increasing the top marginal income tax rate from 37% to 39.6% and raising tax on investment gains from 20% to 39.6% for those earning more than $1 million (£614k). The tax increases on the rich would help to pay for Biden's $2 trillion (£1.4tn) infrastructure plan and $1.8 trillion (£1.3tn) American Families Plan, as Biden believes improvements should be financed by "the wealthiest Americans who can afford it and corporations and businesses who can afford it," according to White House Press Secretary Jen Psaki. However, critics say the super-rich will continue to use measures to bring their tax bills down.
Over the years many of America's super-rich have asked to pay more in taxes than they currently have to. Let's take a look at some of the most notable advocates of higher taxation for the ultra-wealthy.
Morris Pearl currently serves as the Chair of the Patriotic Millionaires, which is a group of America’s wealthiest who are looking to reform the country’s economic system and proudly declare themselves to be "traitors to their class". Pearl was a managing director at investing firm BlackRock and earned millions, but has since left the world of finance and is all for the super-rich paying more money to the state: “In revenue shortfalls, don’t fine the poor – tax the rich… Fairness begets fairness, and it’s as simple as that.”
Former Apple software developer Blaine Garst counts himself among the “patriotic millionaires” seeking to change America’s wealth distribution system. In 2018, he publicly criticised then-President Trump’s tax cuts and the impact that had on his former employer, saying that the move allowed Apple to avoid paying $40 billion (£31.5bn) in taxes. Garst features on the list of 83 of the world’s richest who signed the "Millionaires for Humanity" letter last year to ask the world’s governments to increase their taxes so that they could contribute to the COVID-19 efforts.
Amy Ziering has made a name for herself through her extensive filmmaking career. Ziering addresses social justice issues in her work, such as her most recent documentary On the Record, which examines sexual harassment in the music industry. The issue of tax has also caught Ziering’s eye, and she was listed as one of the 83 wealthy individuals demanding that the state take more of her fortune in light of the coronavirus pandemic.
Chuck Collins is the great-grandson of meat packer Oscar Mayer, founder of the eponymous food corporation. Collins is also the Director of the Program on Inequality at the Institute for Policy Studies, and has an aversion to the super-rich paying little to no tax. Writing for British newspaper The Guardian in 2020, Collins said “every solution to the global challenges we face requires higher taxes on millionaires and billionaires like us… Pay your fair share of taxes.” Collins also signed the “Millionaires for Humanity” letter.
Ron Guillot made his money in the healthcare industry, running a start-up medical care business, while his partner owns a large medical practice that treats thousands of people. But Guillot recognises the inequalities in the healthcare industry, is a member of the Patriotic Millionaires club, and signed the “Millionaires for Humanity” letter last year. Guillot took part in a Tax March event in Colorado (pictured), which was one of more than 150 US locations for demonstrations that took place after then-President Trump refused to release his tax returns in April 2017. His opinion on the marginal tax rates currently in force in the US is clear, and in 2019 he described them as “woefully inefficient, unfair, and, I believe, not in the best interest of all Americans”. It's likely that Guillot would be behind Biden's plans to increase the top marginal rate.
Stanford University professor Terry Winograd also features among the millionaires wanting to pour more of their income into the state as a result of the coronavirus pandemic. Winograd’s professional specialism lies in artificial intelligence and humans’ interactions with tech, and he even spent time as a researcher at Google after advising the company’s co-founder Larry Page during his PhD. As the fast-paced world of AI is one of the most lucrative in the world, Winograd wants to use his accumulated wealth to help others during this global crisis.
Founder and half of the world-famous Ben & Jerry’s ice cream brand, Jerry Greenfield (pictured right) has long supported higher taxes on the rich. Speaking about the 2017 tax cuts in the US, Greenfield said they would “throw people off health insurance”, and were “bad in so many ways”, according to CNBC. And it isn’t just people that Greenfield is keen to tax – he has also imposed a number of taxes on Ben & Jerry’s itself, including the company’s internal carbon tax.
Granddaughter of Roy Disney, who co-founded the eponymous Disney empire, multi-millionaire heiress, activist and filmmaker Abigail Disney is no stranger to immense wealth. In fact, in 2018 she spoke out against the mind-boggling salary that Disney CEO Bob Iger receives, describing his pay packet as "insane" after he was paid $65.6 million (£47.3m) that year, which was 1,424 times that of the median Disney employee. Last year she was also one of the signatories to an open letter to the world’s governments, calling for a higher rate of tax to be imposed on the super-rich in response to the coronavirus pandemic.
The mega-rich horror author, who earned $17 million (£13.5m) in 2019 alone according to Forbes, has no qualms about paying his taxes. In fact, Stephen King has slammed rich people who don't pay their “fair share”, arguing: “Those who have received much must be obligated to pay … in the same proportion.”
While he may not have been as vocal on the subject of finances as his sister Abigail, fellow heir to the Disney fortune Tim was also a signatory on the mega-rich’s appeal letter to try and get the wealthy to contribute more to public funds last year. Tim is best-known for his large real estate portfolio, which includes an LA home that he snapped up from comedian and actress Kristin Wiig for $5.2 million (£4.1m) in 2018.
Seattle-based investor Nick Hanauer is, together with his wife, worth $1 billion (£778m) but, unlike many other ultra high-net-worthers, he advocates much higher taxes on the rich and a more equitable distribution of wealth. Along with 17 other millionaires and billionaires, he signed an open letter to presidential candidates calling for higher taxes in 2019. Hanauer is also campaigning to raise the US minimum wage to $15 (£11.86) an hour as means of tackling poverty and boosting the economy, which he argues come hand in hand.
Jay-Z became the world’s first billionaire rapper in 2019. He said in an interview with CNN: “I’m sure if it was for healthcare and for education and to help people, I think most people with a conscience and some integrity and moral fiber wouldn’t have any problem paying more taxes.” It's even been reported that he helped out fellow rapper Lil Wayne pay off an enormous tax bill after he had built up years of unpaid taxes and fines.
Hedge fund billionaire-turned-environmental activist Tom Steyer is vehemently opposed to tax breaks for the rich and urged President Trump to increase taxes on the wealthiest in order to invest directly in the American people as a whole. Steyer also ran to represent the Democratic Party in the 2020 election, saying that he would “undo every Republican tax cut for rich people and for corporations” if he were to be elected. This never came to fruition as Steyer dropped out of the race in February following disappointing results early on.
One of the heirs to the Dayton family fortune, which was generated by the Target retail empire, former Minnesota governor Mark Dayton raised taxes on the rich while in office from 2011-2019, and is credited with turning around the state's economy. Dayton and his family were estimated to be worth an impressive $1.6 billion (£1.1bn) by Forbes in 2015.
The JPMorgan Chase CEO has no issue with increased taxation on the rich, but would like the money spent judiciously. “I believe that individuals earning the most can afford to pay more, and I have no problem paying higher taxes to address some of the fundamental challenges and inequities in our society,” he has previously told CNBC. Dimon has also spoken out in reference to the coronavirus pandemic, saying that it “must serve as a wake-up call” to create a more inclusive economy, as it has highlighted how many people were “living on the edge” even before the outbreak truly hit.
The Gochmans boasted a family fortune of $2.5 billion (£1.8bn) in 2015, according to Forbes. Molly Gochman is renowned in the world of art, both as a creator and an investor, and is one of the billionaires asking that governments impose stricter tax laws on the world’s richest in response to the coronavirus pandemic.
Agnes Gund inherited a fortune from her banker father, George Gund, who was president of the Cleveland Trust Company, and in 2015 the family fortune was estimated to be around $3.4 billion (£2.4bn) by Forbes. The 83-year-old philanthropist served as president of the Museum of Modern Art for 11 years, and donated to causes including AIDS research, abortion rights and the arts. Despite giving away the lion's share of her fortune, Gund believes she should be paying more tax. She also signed the recent open letter advocating that those in her position contribute more.
A scion of one of America's richest families and a billionaire in his own right, Illinois governor JB Pritzker is nonetheless going after the super-wealthy by proposing a policy initiative of graduated income tax in the state that would ensure that they pay more. So far Pritzker has donated an enormous $56.5 million (£44.7m) of his own money to get his “Fair Tax” bill passed. His values are also shared by his family: two heiresses to the family fortune, Regan Pritzker and Liesel Pritzker Simmons, both signed the open letter to 2020's US presidential candidates calling for higher taxes on the wealthy.
A signatory of Warren Buffett and Bill Gates and Melinda French Gates' Giving Pledge, where the rich commit to donate most, if not all, of their wealth to charity, private equity billionaire David Rubenstein believes it is up to governments to change tax laws so the rich pay more, and would have no problem doing so. Speaking at a conference in Washington in 2012, Rubenstein described the tax system in the US as “a disgrace” that caused inequality across the nation, but in his own defence said “I’m paying what I’m supposed to pay. Change the law, I’ll pay whatever I’m supposed to pay,” according to Reuters.
Mark Cuban is not one to shirk his tax-paying duty. The Shark Tank investor and Dallas Mavericks owner has this to say to Americans who are reluctant to pay their fair share: “Pay your taxes. It's the most patriotic thing you can do.” That said, Cuban did publicly disagree with Senator Elizabeth Warren when she proposed a wealth tax to fund a “Medicare for All” initiative as part of her US presidency campaign, before she dropped out in March.
Howard Schultz, the former Starbucks chairman and CEO who expressed interest in an independent run for the 2020 presidency, gave his opinion on the matter of taxes in a speech in February 2019 at Indiana's Purdue University: “I myself should be paying higher taxes – and all wealthy Americans should have to pay their fair share.”
Billionaire philanthropist Eli Broad is no fan of so-called welfare for the ultra-wealthy. The day after billionaires wrote an open letter to the US presidency candidates in 2019, Broad had an opinion piece on taxes published in The New York Times titled: “I’m in the 1 Percent. Please, Please Raise My Taxes”. It’s not the first time the business mogul has spoken up when it comes to taxes. In 2011, Broad was clear on the matter when he spoke to The Star: “We've been coddled long enough and have tax breaks that 99.9% of the public don't have, and it's not fair.”
Another mega-wealthy individual pushing for higher taxation on the rich is New York real estate heir, and custodian of the National Debt Clock, Douglas Durst, who with his family was estimated to have a net worth of $8.1 billion (£5.7bn) by Forbes in 2020. He is unequivocal when it comes to wanting to hand over more money to the federal government. “I support higher taxes on people like me,” he said in an interview with The Washington Post in 2018. Durst has been consistent when it comes to implementing what he deems to be fair, to the extent that he was expected to testify against his own brother Robert who went on trial for murder in March 2020. The trial was postponed due to the coronavirus pandemic but restarted in May.
George Soros supports proposals that raise taxes on the rich and has been a long-time advocate of a fairer distribution of wealth in society. He also signed the 2019 letter appealing for higher taxes for the mega-rich, and in 2011 was quoted in The Star saying that the rich are “hurting their own long-term interests by their opposition to paying more taxes." Still, the investor has been accused of hypocrisy by pouring billions into charity to sidestep tax and for moving the domicile of his Soros Fund to low-tax Ireland – the deferrals added up to an enormous $13.3 billion (£10.5bn) by the end of 2013.
Salesforce founder Marc Benioff has called out fellow tech billionaires in San Francisco for failing to help tackle the growing problem of homelessness in the city, and endorsed Propisition C, a successful November 2018 ballot which levies a 0.5% tax on businesses with more than $50 million (£39.5m) in revenue that goes towards funding homelessness services. Benioff and Salesforce contributed $7 million (£5.4m) to support the proposal, which was set to cost Salesforce $10 million (£7.8m) extra a year.
Michael Bloomberg’s eagerness to tax the wealthy can be seen throughout his political career. He has always believed that everyone should pay their fair share, and when he was mayor of New York he hiked up property and income taxes for those with high salaries. As part of his presidential campaign, the billionaire unveiled a $5 trillion (£3.9tn) tax plan in a bid to get the wealthy to pay more and reverse tax cuts imposed by the Trump administration, but Bloomberg then dropped out of the race in March last year after missing the voting threshold in a number of states. He had spent near to $1 billion (£720m) on his campaign for the top job. Despite being adamant that the rich should pay more tax, the recent ProPublica investigation claimed that Bloomberg himself had paid a “true tax rate” of just 1.3% between 2014 and 2018.
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Warren Buffett, known as "The Oracle of Omaha", thinks the wealthy are under-taxed compared to the general population. He came up with the "Buffett Rule", which was part of Barack Obama’s 2011 tax proposal and suggests that no millionaire or billionaire should pay a lower effective tax rate than a regular working person. It seems like common sense, but the ProPublica investigation alleges that Buffett had a “true tax rate” of just 0.1% between 2014 and 2018. Buffett has donated a total of $37 billion (£29.2bn) to charity since 2006, although cynics have questioned whether this was done for the sake of tax benefits. In response, Buffett has said that for every $1,000 (£720) that he has donated, his tax payments are reduced by around 43 cents (£0.34). He also created The Giving Pledge alongside Bill Gates and Melinda French Gates.
Facebook has attracted criticism for its tax avoidance, but the social media behemoth's chairman and CEO has said in the past that he is “cool” with paying more income tax, and claims he will receive no tax benefits from his philanthropic endeavours. In 2019, Facebook paid just £28 million ($36m) in tax in the UK, despite revenue of £1.6 billion ($2bn) there, and Zuckerberg has since met with world leaders and members of the European Commission to discuss how tech giants are taxed and to say that he is “happy to pay more tax”.
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A frequent advocate of higher taxation on the rich, Gates has paid more than $10 billion (£7.2bn) in taxes during his lifetime, and in 2019 he said that if it went up to $20 billion (£14.4bn) that would be “fine”. Gates strongly believes in a more progressive system and is of the opinion that he should have paid more on his capital gains in particular. He and his soon-to-be ex-wife, Melinda, even started a foundation which spends billions on fighting poverty and disease each year, as well as The Giving Pledge with Warren Buffett.
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