The Tesla CEO paid a 3.27 per cent true tax rate, or $455 million, for his wealth growth of $13.9 billion over the five-year period between 2014 and 2018, ProPublica reports.
His taxable income during that five-year period was $1.52 billion, the publication added, but Mr Musk didn’t pay anything in federal income taxes in 2018.
When contacted by ProPublica for a comment, Mr Musk responded with a simple “?” and otherwise ignored the question.
ProPublica obtained confidential IRS data on thousands of wealthy people in its analysis. The analysis found that Mr Musk, as well as other prominent US billionaires, escaped paying federal income taxes.
The 25 richest Americans “saw their worth rise a collective $401 billion from 2014 to 2018,” the publication reported. But collectively those Amerians paid a total of $13.6 billion in federal income taxes over those five years, which was a true tax rate of just 3.4 per cent.
This compared to the median US households that earned about $70,000 annually but paid a 14 per cent tax rate to the federal government. Couples in the highest tax rate paid 37 per cent to the federal government for annual earnings of higher than $628,300, the analysis added.
Billionaire Warren Buffett, who had a reported income of $125 million over the five years despite his wealth growing 24.3 billion in that same timeframe, paid the lowest tax rate out of those analysed by the publication. His true tax rate was just 0.10 per cent.
Amazon CEO Jeff Bezos, the world’s richest person, paid a total of $973 million in taxes to the federal government over the five-year period for his reported income of $4.22 billion, making his true tax rate 0.98 per cent.
Then Michael Bloomberg, the former New York City mayor and founder of Bloomberg LP, reported an income of $10 billion but paid just $292 million to the federal government for a true tax rate of 1.3 per cent.
ProPublica noted that billionaires have access to “tax-avoidance strategies beyond the reach of ordinary people,” which has likely assisted them in paying a lower true tax rate compared to the average American.
But the obtained IRS reports show a significant divide between America’s top earners and the rest of the country in percentage of wealth paid back to the federal government.
ProPublica did not disclose how it obtained the tax records, which are confidential to the private individual and illegal for the IRS to distribute.
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