Why It’s So Hard to Tax Trillionaires
On Everybody’s Business, we reveal the tax-avoiding tricks of the ultra-rich and the economic influence of Generation Alpha.
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If most of your money comes in through your paycheck, you may be a sucker. This according to Ray Madoff, professor at Boston College Law School and author of The Second Estate: How the Tax Code Made an American Aristocracy. According to Madoff, the ultra-wealthy of the world do not get most of their money from income (which is carefully taxed). Instead, their wealth is generally tied up in things like stock options, family trusts, houses, yachts, rare coin collections and all other manner of places and things that typically are not taxed. Madoff points out that Jeff Bezos, one of the richest people in the world, has a salary of about $80,000 per year. This of course means you might be able to tell people at parties you make more than the Amazon founder. But it also means Bezos is able to get around paying taxes on much of his wealth. In fact, the effective tax rate for the ultra-rich is around 22%, while for working stiffs overall, it’s about 30%.