US Super-Rich Allegedly Pay Very Little Taxes, Claims Leaked Documents

A new website has published leaked data that shows claimed details of how little income tax is actually paid by billionaires of the United States. The tax returns of some of the richest people of the world, including Jeff Bezos, Elon Musk and Warren Buffett, have been seen by it, says ProPublica.

While the Amazon.com chief Bezos paid no tax in 2007 and 2011, Tesla’s co-founder Musk paid no tax in 2018.

The leak was described as being “illegal” by a White House spokeswoman and said that the matter is being investigated by the FBI and tax authorities.

A “vast trove of Internal Revenue Service data” on the taxes of the billionaires was being analysed by it, ProPublica said and added that it would release more data in the coming weeks.

This alleged tax data of the US billionaires was revealed at a time when there is a growing debate of the widening wealth inequality in the world and the amount of tax paid by the wealthy.

Compared to most of the mainstream workers in the US, less taxes – at an average of just 15.8 per cent of their adjusted gross income, is paid by the 25 richest Americans, ProPublica said.

“Using perfectly legal tax strategies, many of the uber-rich are able to shrink their federal tax bills to nothing or close to it” even as their personal wealth has increased over the past few years, the website said.

Just like ordinary citizens, it is possible for the wealthy to reduce their tax burdens by the use of legal strategies such as charitable donations and getting money through investment income instead of income from wages, say tax experts.

Using data that had been gathered by Forbes magazine, ProPublica said that between from 2014 to 2018m the combined personal wealth of the 25 richest Americans surged by $401bn while they paid only $13.6bn in income tax during that period.

In recent comments, US President Joe Biden has pledged to increase the tax burden of the richest Americans as a part of his plans to enhance equality while also being able to raise money for the massive infrastructure investment programme that has been drawn out by him. According to Biden’s plans, his administration intends to increase the top rate of tax, double the tax collection from the high earners that they make from investments, and bring in changes in the inheritance tax regimen.

But the analysis of the tax data by analysts of ProPublica concluded: “While some wealthy Americans, such as hedge fund managers, would pay more taxes under the current Biden administration proposals, the vast majority of the top 25 would see little change.”

A number of articles have been previously written by ProPublica, an investigative website, over the issue of how the ability of the US Internal Revenue Service in enforcing tax regulations on the wealthy and large corporations have been hampered by budget cuts. It had acquired the leaked documents in response to these articles the news organisation said.

White House Press Secretary Jen Psaki said that “any unauthorized disclosure of confidential government information” is illegal.

(Adapted from BBC.com)



Categories: Economy & Finance, Entrepreneurship, Regulations & Legal, Strategy, Sustainability, Uncategorized

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