The richest facial tax hit in the world after a 40% increase in wealth to $ 8.4 billion
Facebook, Apple, Amazon, Netflix, Google and Microsoft collectively bypassed around $ 100 billion in U.S. taxes from 2010 to 2019, according to an analysis of regulatory returns from Fair Tax Mark, a progressive think tank.
Many of these untaxed profits have been transferred to tax havens like Bermuda, Ireland, Luxembourg and the Netherlands.
Amazon paid an effective corporate tax rate of 11.8% in 2020, according to an analysis by Bloomberg Economics, and that’s hardly an outlier among very successful tech companies. Facebook, founded by the fifth richest person in the world, Mark Zuckerberg, paid 12.2% last year.
Asked to comment on this article, an Amazon spokesperson highlighted some of the company’s previous statements regarding its tax bill, including: laws. “
As the mix between a tech company and a retailer with massive physical infrastructure, Amazon is able to use a host of long-standing and discreet tax preferences for compensation for stocks, buildings, research and development. .
Bezos pushed to reinvest profits in the business, a strategy that keeps taxable income low and tax breaks high.
Amazon completely avoided federal income taxes in 2017 and 2018 through its judicious use of the tax code. The company has since had to pay income tax to the Internal Revenue Service, but it is well below the overall rate of 21% installed under President Donald Trump.
Billionaire tech founders often pay even less personally than their companies.
Bezos, for example, got $ 77 billion richer in 2020, according to the Bloomberg Billionaires Index. But in the United States, gains on stocks are only taxed when they are sold, at a rate much lower than what affluent workers pay, meaning Bezos owed the Treasury a few billion dollars in taxes at most. American last year.
“The wealthiest in this country, who profited immensely during the pandemic, have not paid their fair share,” Senate Finance Committee Chairman Ron Wyden said after ProPublica reported on Tuesday that several of the billionaires around the world, including Bezos, have paid no federal income. taxes certain years.
The media organization said it obtained confidential tax documents on thousands of the richest Americans, including Warren Buffett and Michael Bloomberg, owner of Bloomberg LP, the parent company of Bloomberg News. Bloomberg and others told ProPublica they paid the taxes they owed.
To remove the benefits of the U.S. tax code that benefit the ultra-rich, Biden proposed taxing legacy assets that currently escape levies and raising the maximum rate on investment income so that well-paid workers and investors pay the same.
Internationally, the administration is seeking a global minimum tax of at least 15% for the world’s most profitable companies – the deal is expected to be brought forward at the G-7 meeting this weekend.
The G-7 deal would change other corporate tax rules to undermine efforts to shift profits to low-tax countries. Biden also advocates raising the rate on U.S. corporations to 28%, partially reversing Trump’s tax overhaul.
Tech companies could see their effective tax rates rise if a global tax deal is struck, according to a Morgan Stanley study. Alphabet’s Facebook and Google could both pay 28% of their profits globally, up from 18% and 17% respectively under current rules, according to the report.
Despite all the talk about taxing the rich, Biden’s proposals and the international tax deal face serious hurdles before being passed.
While some of his fellow Democrats, who tightly control Congress, push for more sweeping estate and wealth tax changes, others are hesitant.
The next step in the global tax negotiations, which were launched years ago by the Organization for Economic Co-operation and Development and have involved around 140 countries, is to secure the agreement of the Group of 20 countries.
G-20 finance ministers, who collectively oversee around 90% of the global economy, will meet in July in Venice.
Obstacles to reaching a deal by the end of the year include China, which could seek minimum tax exemptions.
Still, there is hope that the global effort “will put an end to the madness,” said Pascal Saint-Amans, director of the center for fiscal policy at the OECD. “You had loopholes everywhere and no one was dealing with them. It undermines the very purpose of capitalism and a market economy.