Elon Musk recently decided to sell off approximately $6.9 billion USD worth of Tesla stock based on a Twitter poll that garnered more than 3.5 million responses. “Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock. Do you support this?” stated the poll. 57.9% of the public clicked yes, and Elon followed through which resulted in a 15% tumble of the EV company’s shares.
For this fiscal year, Musk will be potentially facing a massive tax bill for his overall income and market activity. Sanders, on the other hand, has been a long-time proponent for hiking taxes for the ultra-rich. A week following Musk’s tax sell-off, Bernie tweeted demanding more accountability for the ultra-wealthy to pay their fair share of taxes, which clearly struck a nerve with Musk as he responds to the senator in a series of tweets.
“We must demand that the extremely wealthy pay their fair share. Period,” posted on his Twitter page. Musk responded with two separate tweets saying, “I keep forgetting that you’re still alive,” and “Ok, how much do you think is fair? Does 53% seem reasonable?” Sanders has yet to respond.
The U.S. tax system is generally progressive with the top 1 percent paying approximately 32% in federal income tax, while the lowest-earning 1% receives more in social benefits than they pay in taxes. As Musk’s reported income was $1.52 billion USD between 2014 and 2018, Elon was technically taxed 33%, but wealth in the US is non-taxable, and ProPublica reports that Musk paid a 3.27% true tax rate in those five years, which is approximately $455 million USD, based on his net wealth growth of $13.9 billion USD.
