Elon Musk fires back at critics: ‘I will pay over $11 billion in taxes this year’

image

Tesla’s visionary CEO Elon Musk can add another distinction to his list of record achievements—although it’s likely to be one he won’t relish.

The wealthiest human to ever walk the earth posted on Twitter he will fork over more than $11 billion to the U.S. government this year, a tax bill that just may be the biggest—in absolute terms, anyhow—of all time.

Musk’s contribution comes amid fierce criticism from leading Democrats, including senators Bernie Sanders and Elizabeth Warren, that billionaires have enriched themselves on the back of other taxpayers while refusing to pay their fair share of taxes.

Warren even went so far as to brand him a “freeloader,” leading to a testy back-and-forth on Twitter in which Musk called her “Senator Karen.”

“For those wondering, I will pay over $11 billion in taxes this year,” Musk wrote in a weekend tweet, a kind of raising-of-the-white-flag on the dispute.

The $11 billion tax payout would be well above the previous record dished out by hedge fund giant and New York Mets owner Steven Cohen, who reportedly had to pay $3 billion.

The pandemic has sparked a wider debate—on social media and elsewhere—about the widening chasm between an increasing number of Americans struggling during the COVID pandemic, and, further up the pyramid, a handful of “centibillionaires” who have seen their net worth balloon during the past two years.

The Tax Justice Network, a nongovernmental advocacy group, estimated last month that the world’s population could be fully vaccinated three times over with the $483 billion in taxes not paid by multinational corporations and wealthy individuals, the latter of which, they say, have evaded $171 billion in tax.

Musk has argued the “only way” for him to pay taxes personally is to sell stock. That’s because he does not take a cash salary or bonus from anywhere, with his fortune tied solely to his equity holdings.

Musk allies sound off

The subject of Musk, who was recently named Time’s Person of the Year, legally skirting taxes on his fortune sparked an angry backlash by his legion of adoring fans, who have ridden the stock’s rally to newfound wealth themselves.

Tesla influencer Dave Lee attacked Sen. Warren in a podcast, while New Street Research analyst and Tesla bull Pierre Ferragu said he hoped the taxes Musk pays this year will finally placate their anger.

Musk’s overnight tax tweet follows a string of tweets about share sales over the past month. Since the Nov. 4 all-time high, the Tesla share price has been in bear-market spiral, falling more than 20%. In premarket trading, Tesla is down more than 2% today.

Tax dodging took on a whole new dimension in June after ProPublica revealed the ultrawealthy barely paid any taxes, citing individuals like Elon Musk, Jeff Bezos, and Warren Buffett.

Basing its calculation on actual tax returns filed, the investigative journalist operation estimated the 25 richest Americans collectively paid just $13.6 billion in federal income taxes in the five years through 2018, in part by borrowing against their stock holdings.

The Tesla CEO called the ProPublica report “very misleading” and “trickery” in a September interview with Recode, arguing it is a risk to pledge equity as collateral because share prices can also drop and trigger margin calls.

“They have no interest in the truth,” he told Recode’s Kara Swisher. “My top marginal tax rate is 53%, so I don’t think that’s particularly low, and it’s going to go up next year.”

Over to you, Jeff. 

Trending Ideas

Featured Stocks On The Move

Daily Rundown

Top 3 Stocks in Leading Sectors
  • 3 Steel Product Stocks To Buy Now

    Perma-Pipe International Holdings, Inc. (PPIH) Perma-Pipe International Holdings, Inc. specializes in engineered piping solutions for various industries, including oil and gas, district heating and cooling, and industrial applications. The company... Read More

  • 3 Oil Field Machinery Stocks To Buy Now

    Matrix Service Company (MTRX) Matrix Service Company provides engineering, fabrication, construction, and maintenance services to energy and industrial markets. The company operates through segments such as Storage and Terminal Solutions,... Read More

  • 3 Restaurant Stocks To Buy Now

    Brinker International, Inc. (EAT) Brinker International, Inc. is a leading casual dining restaurant company, operating well-known brands such as Chili’s Grill & Bar and Maggiano’s Little Italy. The company focuses... Read More

  • 3 Coal Stocks To Buy Now

    Natural Resource Partners L.P. (NRP) Natural Resource Partners L.P. is a master limited partnership that owns, manages, and leases a diversified portfolio of mineral properties in the United States. The... Read More

  • 3 Real Estate Developer Stocks To Buy Now

    IRSA Inversiones y Representaciones Sociedad Anónima (IRS) IRSA Inversiones y Representaciones Sociedad Anónima is a leading real estate company in Argentina, engaged in the acquisition, development, and management of diversified... Read More

  • 3 Gas Distribution Stocks To Buy Now

    New Jersey Resources Corporation (NJR) New Jersey Resources Corporation is an energy services holding company that provides regulated natural gas distribution services through its subsidiary, New Jersey Natural Gas. The... Read More

  • 3 Food Product Stocks To Buy Now

    The Chefs’ Warehouse, Inc. (CHEF) The Chefs’ Warehouse, Inc. is a premier distributor of specialty food products, serving high-end restaurants, hotels, and gourmet food stores across the United States and... Read More

  • 3 HVAC Stocks To Buy Now

    Featured Content Lennox International Inc. (LII) Lennox International Inc. is a global leader in energy-efficient climate control solutions, specializing in heating, ventilation, air conditioning, and refrigeration (HVACR) products. The company... Read More

  • 3 Hotel Stocks To Buy Now

    Featured Content Hyatt Hotels Corporation (H) Hyatt Hotels Corporation operates a global portfolio of luxury, full-service, and lifestyle hotels, as well as vacation properties. Known for its premium hospitality offerings,... Read More

  • 3 Tobacco Stocks To Buy Now

    Featured Content Turning Point Brands, Inc. (TPB) Turning Point Brands, Inc. is a consumer products company that manufactures and markets tobacco products and alternative smoking accessories. The company’s portfolio includes... Read More

  • 3 Life Insurance Stocks To Buy Now

    Featured Content F&G Annuities & Life, Inc. (FG) F&G Annuities & Life, Inc. specializes in annuities and life insurance products designed to meet the long-term financial planning needs of clients.... Read More

  • 3 Soft Beverage Stocks To Buy Now

    Featured Content Westrock Coffee Company (WEST) Westrock Coffee Company is a leading integrated coffee, tea, and extract service provider, offering comprehensive solutions from sourcing and roasting to packaging and distribution.... Read More