Billionaire Elon Musk is no fan of the billionaire-tax proposal from Democrat lawmakers.
SpaceX and Tesla CEO Elon Musk. © Kimi Talvitie; NASA; Mark Brake/Getty Images; Samantha Lee/Business Insider
In his most recent critique, Musk said he would use the billions in tax dollars to reach Mars.
“My plan is to use the money to get humanity to Mars and preserve the light of consciousness,” he said.
Billionaire Elon Musk is once again critiquing the proposed billionaire tax, which could cost him as much as $50 billion if it were enacted.
That $50 billion, he argues, could be used on his goal to reach Mars on rockets produced by his company, SpaceX.
“My plan is to use the money to get humanity to Mars and preserve the light of consciousness,” Musk said on Thursday.
The new tax proposal, unveiled this week by Sen. Ron Wyden of Oregon, directly targets the 700 or so richest Americans. That of course impacts the people on the very top of that list, including Amazon cofounder Jeff Bezos, Microsoft cofounder Bill Gates, and Tesla and SpaceX CEO Elon Musk.
Of that group, Musk currently ranks the highest with a nearly $300 billion net worth, according to the Bloomberg Billionaires Index. His net worth, however, is primarily tied to his stock holdings rather than his annual income.
Under the proposed bill from Senate Democrats, taxpayers earning over $100 million in annual income or who have at least $1 billion in assets held for three years or more would owe billions in taxes. Musk in particular could owe as much as $50 billion in taxes across the next five years, and Bezos would face a similarly high tax bill of $44 billion, according to one projection.
Even after paying those tax bills, Musk and Bezos would remain the richest people on the planet.
Musk critiqued the proposal on Wednesday as well, with a Twitter post that said, “Eventually, they run out of other people’s money and then they come for you.”
Unlike most Americans, who earn money through paychecks that contribute to an annualized income, billionaires like Bezos and Musk derive little wealth from their paychecks, which enables them to skip paying income taxes.
The majority of Bezos’ net worth — $196 billion — is tied to a 10.3% stake in Amazon that’s currently worth about $175 billion. Because stock prices fluctuate regularly, the billionaire has at times jockeyed for the world’s wealthiest title with Elon Musk.
Bezos can skip paying taxes on his accumulated wealth from the Amazon stock because, under current law, stock gains aren’t taxed until they are realized by selling off the stock: Since those stocks represent value, but cannot be used as tender, they aren’t counted as “income” — even if they appreciate in value tremendously, like those of Amazon and Tesla.
Moreover, Bezos and other stock-holding billionaires are able to turn those stocks into usable cash without having to sell: By borrowing money against their stock holdings, they’re able to lock in a lower loan interest rate than what they would pay through capital gains taxes that are applied after a stock is sold.
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