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📂 **Category**: Commerce,jeff bezos
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On Wednesday morning, Jeff Bezos said in an interview on CNBC that Americans earning in the bottom half should not pay taxes.
“Why would a nurse in Queens who makes $75,000 a year pay more than $1,000 a month in taxes?” Bezos said. “That’s $1,000 that could help pay the rent, or groceries, or whatever… To me, it’s absurd that we’re doing this. We shouldn’t be asking this nurse in Queens to send money to Washington. They should send her an apology.”
Bezos argues that the bottom half of earners pay only 3% of total taxes, so people like that nurse struggle to make ends meet while devoting about 16% of their paychecks (by Bezos’s estimate) to paying taxes that barely move the needle in Washington.
This moment of sympathy may come as a surprise coming from Bezos, one of the richest people in the world. Billionaires like Bezos have taken advantage of loopholes in the tax system so they can pay income tax on only a small percentage of their annual gains. In 2007 and 2011, Bezos paid no income tax at all. According to a ProPublica investigation, Bezos’ wealth increased by $127 billion from 2006 to 2018, but he reported income of $6.5 billion. While this represents a huge tax payment of $1.4 billion, this represents a tax rate of only about 1 percent.
This is not illegal. Americans are not taxed on unrealized capital gains, which means that if Amazon shares rise to make Bezos richer, he will only pay taxes once he sells that stock. Rich people do their best to hold on to their investments. Instead, they take out huge loans using their stocks as collateral, and they live off those loans, avoiding paying taxes on them, because those loans are technically debt.
Has Jeff Bezos finally realized how unfair this is? Does he now understand the frustration of middle-class people, who can’t just take out loans on their piles of company stock to avoid reporting capital gains?
“[Senator] “Elizabeth Warren has made this point over and over again…You and others are able to pay a lower tax rate — even though you pay an enormous amount of taxes — a lower tax rate than I, for example, would,” CNBC correspondent Andrew Ross Sorkin asked Bezos.
It is unlikely that Bezos will invite Senator Warren to dinner at one of his many palaces. As he put it, the United States has a spending problem, not a revenue problem.
“We already have the most progressive tax system in the world,” Bezos said. “The top 1% of taxpayers pay 40% of total tax revenue. The bottom half pay only 3%.”
However, Bezos still pays taxes at a lower rate than most Americans. This fact remains true, even after he paid taxes on the Amazon stock he sold to fund Blue Origin, a space exploration company.
“If people want me to pay billions more, let’s have this discussion,” Bezos said. “But don’t pretend this will solve the problem.” “You could double my taxes, that wouldn’t help [nurse] In Queens.”
It’s basically hard to imagine that we couldn’t find some productive use for the billions of extra dollars that Bezos could pay in taxes, even when combined with a massive $7.4 trillion federal budget.
Maybe that nurse in Queens would find it helpful if she could reliably use public transportation to get to work, or if she could send her children to public schools that already have enough supplies needed. Maybe she would be grateful if she could go to the hospital in an emergency without having to worry about how to pay thousands of dollars in medical bills.
Of course, these imaginary scenarios depend on our confidence in the government’s ability to distribute our tax dollars appropriately and in ways that will help.
“If you really want to have a progressive tax system, you also want this money to actually help, not just dissolve into, you know, administrative bureaucracy,” Bezos added.
But money feels different when it’s something real, tangible — a finite number that shows up in your bank account every two weeks, which must immediately cover rent, groceries, car payments, student loans, and other debts.
If it’s naive to dream of what we could achieve if billionaires paid their fair share of taxes, so be it. It is also naive to think that we can build data centers on the moon.
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