Sunday, December 5, 2021

“I doubt it’s legal and it’s stupid,” the billionaires complain about the proposed tax.

Elon Musk is unhappy.

With a personal fortune that flirts with $ 300 billion, Tesla CEO – the richest man on earth – criticized the Democrats’ proposal to tax the assets of billionaires like him.

The idea behind the Democratic Party plan is to use the proceeds of the billionaire tax to help pay for a domestic policy package under discussion in Congress that will, among other things, help fight climate change, ensure universal preschool education and expand programs. health care.

Musk, who recently surpassed Amazon founder Jeff Bezos to become the world’s # 1 wealthiest due to Tesla’s skyrocketing share price, will be liable for possibly $ 50 billion in taxes, according to the Democratic Party proposal.

“Forget it,” he says.

“My plan,” the SpaceX founder tweeted Thursday about his condition, “is to use the money to get humanity to Mars and keep the light of consciousness.”

He may well fulfill his desire. The prospect of taxing billionaires in Congress is rapidly dimming. Key West Virginia Senator Joe Manchin is signaling his opposition to the plan along with several others, including some of his fellow Democrats, who have called such a tax logistically impractical.

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Musk argued earlier this week that the main problem is that the government is spending too much money, and he warned that the billionaire’s tax proposal could lead to higher taxes for more Americans over time.

“In the end,” he tweeted on Monday, “they are running out of other people’s money and they are coming for you.”

The Democratic Party proposal, unveiled Wednesday by Senator Ron Wieden, would tax the income of people with assets of $ 1 billion or more or income of $ 100 million or more for three consecutive years. This applies to fewer than about 800 people who will have to pay tax on the value of tradable items, such as stocks, even if they do not sell them. According to the current legislation, such assets are subject to taxation only upon sale.

Supporters said the tax could raise $ 200 billion over 10 years, helping fund Biden’s legislative priorities.

Republicans are united in opposition to this proposal. And some have suggested that this will be challenged in court.

The Democrats’ proposal comes amid growing concern over huge economic inequality, as the wealth of many American multibillionaires increased during the COVID-19 pandemic, thanks to increased inventories and net worth even more than before the virus hit.

John Katsimatidis, grocery billionaire and real estate tycoon who owns Gristedes, denounced the offer as something you “expect from Putin,” meaning Russian President Vladimir Putin.

The billionaire’s tax plan is, Katsimatidis told The Associated Press, “a little crazy.”

“The American people have gone so far as to say, ‘Enough, enough,’” said Katsimatidis, who lost the 2013 Republican nomination for mayor of New York.

“Stop wasting money stupidly. They come up with budgets that are stupid and want everyone to suffer for it. “

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“Do we need infrastructure?” Katsimatidis added. “Of course we need infrastructure. Do we need bridges to nowhere? No, we don’t need them. “

“You’re talking about people who create jobs,” he said of billionaires. “We can get up and go somewhere else.”
Leon Cooperman, an outspoken billionaire investor who long ago denounced Senator Elizabeth Warren’s own wealth tax proposal, added his voice to the annoyance emanating from some of the super-rich.

In an interview with The Daily Beast, Cooperman said of the tax, “I doubt it’s legal and it’s stupid.”

“What made America great,” he said, “are the people who started out with nothing like me, making a lot of money and giving it back. Ruthless attacks on rich people don’t make sense. “

Not every billionaire shares this outrage. A spokesman for George Soros, an investor and liberal philanthropist, told AP that Soros “supports the proposed tax for billionaires.”

And while Warren Buffett has yet to publicly comment on the proposed tax, the billionaire CEO of Berkshire Hathaway has long called for tax hikes for the super-rich like himself.

Bob Lord, a tax lawyer and associate fellow at the Institute for Advanced Study Research, said that even if this particular proposal is not accepted, it does reflect growing concerns about financial inequality.

ProPublica reported in June that some of the wealthiest Americans have paid or barely paid income taxes for several years, including Musk, who reportedly paid no zero income tax in 2018. Critics argue that Musk’s criticism of the billionaire’s tax proposal overlooks the fact that Tesla’s growth has been fueled by government incentives and loans.

Lord, for example, noted that the rise in Tesla’s stock value on Monday following a large order for Tesla from Hertz increased Musk’s fortune by about $ 37 billion – more than what the IRS collects in property tax revenue and donations from across the country in USA. one year.

Wyden’s proposal, the lord suggested, might require some loopholes to be closed.

“But I think they did a pretty good job with it,” he said. “There are people who say that billionaires will simply invest their money in assets that are not traded on the stock exchange. But it won’t be that easy. It’s a pretty well-written bill. “

Such tax changes could also change the way billionaire philanthropists donate.

Brian Mittendorf, a professor of accounting at Ohio State University, said that in the short term, the billionaire’s proposal would lead some of the super-rich to rush charitable contributions to so-called donor-recommended funds. Such funds would allow them to receive tax payments in advance without distributing the money. (Donors cannot get money back from these funds.)

“If it does happen,” Mittendorf said, “it will create huge incentives for donating some of these assets, which rose in value before taxes fell.”

Nation World News Desk
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