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Friday, Apr 19, 2024

US Lawmakers' Dig At Elon Musk For Bragging About Paying $11 Billion In Taxes

US Lawmakers' Dig At Elon Musk For Bragging About Paying $11 Billion In Taxes

The CEO of Tesla Motors and Space-X, Musk had on December 20 tweeted: "For those wondering, I will pay over $11 billion in taxes this year." The tax bill is considered as one of the highest in US history.

Top US lawmakers, including Indian-American Congresswoman Pramila Jayapal, have criticised Elon Musk, the world's wealthiest man and Tesla Motors CEO Elon Musk for bragging about paying USD 11 billion in taxes.

In a tweet on Wednesday, Texas Senator Ted Cruz said, "Got it. You don't like @elonmusk Who else do you want to loot?" The Republican Senator's tweet was in response to a post on Twitter by Jayapal, a Democrat, taking a dig at Musk for showing off his tax bill.


"Elon Musk made $36 BILLION in one day, but wants to brag about paying an $11 billion tax bill," she said in a tweet.

"Oh yeah, he also added more than $270 BILLION in wealth just since the pandemic started," she said, adding that it was time for the rich to pay their fair share.

The CEO of Tesla Motors and Space-X, Musk had on December 20 tweeted: "For those wondering, I will pay over $11 billion in taxes this year." The tax bill is considered as one of the highest in US history.

Earlier, Democratic Party Senator Elizabeth Warren, referring to Musk, had tweeted, "Let's change the rigged tax code so The Person of the Year will actually pay taxes and stop freeloading off everyone else." This led to an ugly spat between the two with Musk replying, "And if you opened your eyes for 2 seconds, you would realise I will pay more taxes than any American in history this year." Musk has sold off USD 14 billion worth of Tesla stock since early November, after asking his followers in a Twitter poll if he should sell 10% of his holdings. In the poll, his followers said he should pay.

But it's likely Musk would have begun selling anyway. That's because he faces a massive tax bill on Tesla stock options, according to an earlier CNBC report.

Musk's wealth comes from stock awards and gains in Tesla's share price.

Though Tesla shares have taken a tumble since Musk's Twitter poll, they remain incredibly valuable - the stock is up 28 per cent year-to-date, the report said.

He could have waited until next year to pay the tax bill, but that would have meant potentially getting hit by higher tax rates under the Democrats' Build Back Better bill, it said.

The report quoted a ProPublica investigation showing that Musk and several other billionaires paid no federal income taxes in 2018.

Between 2014 and 2018, Musk paid USD 455 million in taxes on USD 1.52 billion of income, despite his wealth growing by $13.9 billion over that period, it said.

Musk was granted the share options in 2012 as part of his pay package, and the options vested as Tesla hit various financial and operational targets in subsequent years. But he did not have to pay taxes on the options until he exercised them, which he started to do in November, a CNN report said on Wednesday.

With a top tax rate of 40.8 per cent, Musk, the richest person in the world with a net worth of USD 280 billion, faces a federal tax bill of about USD 10.7 billion from the exercise of these shares, the report said.

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