The 500 richest people on the planet collectively added $852 billion to their fortunes in the first half of 2023 due in large part to a record-breaking rally in the U.S. stock market.
According to a Bloomberg analysis of its Billionaires Index, the world’s richest people added an average of $14 million per day to their wealth over the past six months, “the best half-year for billionaires since the back half of 2020, when the economy rebounded from a COVID-induced slump.”
Tesla CEO and Twitter owner Elon Musk saw the largest net worth boost of any global billionaire, adding nearly $97 billion in the first half of the year. Mark Zuckerberg, the chief executive of Meta, saw his wealth grow by close to $59 billion, the second-largest gain of any billionaire.
“They can afford to pay their fair share in taxes,” Americans for Tax Fairness said Wednesday in response to the Bloomberg analysis.
In the U.S., capital gains are only taxed when they’ve been realized, such as when stock is sold. That’s how Musk and other mega-billionaires have massive fortunes, but small tax bills, as ProPublica detailed last year in its reporting on a trove of IRS documents.
“With the exception of one year when he exercised more than a billion dollars in stock options, Musk’s tax bills in no way reflect the fortune he has at his disposal,” the investigative outlet noted. “In 2015, he paid $68,000 in federal income tax. In 2017, it was $65,000, and in 2018 he paid no federal income tax. Between 2014 and 2018, he had a true tax rate of 3.27%.”
In his budget proposal for fiscal year 2024, U.S. President Joe Biden called for a tax on the unrealized gains of the ultra-wealthy—an idea previously put forth by Sen. Ron Wyden (D-Ore.). But the measure is unlikely to get through the Republican-controlled House, which is currently looking to slash taxes for the wealthiest Americans.
The already-slim prospects of getting a wealth tax approved in the near future could soon get even worse.
Late last month, the conservative-dominated U.S. Supreme Court agreed to take up a case that “could preempt Congress and the Biden administration from instituting a federal wealth tax,” The Lever reported.
“The new case, Moore v. United States, is tailored to try to block Democrats’ promised agenda by defining what can—and cannot—count as taxable ‘income’ under the Constitution. It specifically challenges a one-time levy on some shareholders for their foreign corporate earnings that was included in the 2017 Republican tax law,” The Lever explained. “The real goal of the case is ‘to slam shut the door on a federal wealth tax,’ as the couple’s lawyers wrote in a 2021 column. The couple’s petition to the Supreme Court expressly decries previous wealth tax proposals from Democrats, including Biden, and urges the justices to ‘head off a major constitutional clash down the line.'”
Wyden, the chair of the Senate Finance Committee, warned in a statement that “the petitioners in Moore are hoping the Supreme Court will toss out a Ninth Circuit ruling along with potentially decades of settled tax law and bipartisan agreement on congressional authority, all for the benefit of the ultra-wealthy.”
“If the Republicans on the Supreme Court take the petitioners’ side, they’d be handing a massive windfall to multinational corporations and could potentially lock in a right for billionaires to opt out of paying anything remotely close to a fair share in taxes,” the senator said. “I designed my approach to taxing billionaires, the centerpiece of which is an accounting method already used in our tax code, with the understanding that special interests would come at it with well-funded legal challenges. I’m totally confident that it’s constitutional.”