After Elon Musk asked his Twitter followers to vote on whether he should sell 10% of his Tesla stock, the architect of the proposed billionaires tax that prompted the move dismissed the tweet as a stunt.
“Whether or not the world’s wealthiest man pays any taxes at all shouldn’t depend on the results of a Twitter poll,” said Ron Wyden, an Oregon Democrat and chair of the Senate finance committee. “It’s time for the billionaires income tax.”
Wyden has led Democrats pushing for billionaires to pay taxes when stock prices go up even if they do not sell shares, a concept called “unrealised gains”.
Proponents of the tax say it would affect about 700 super-rich Americans, who would thus help pay for Joe Biden’s $1.75tn 10-year public spending proposal, which seeks to boost health and social care and to fund initiatives to tackle the climate crisis.
Last month, unveiling his proposal, Wyden said: “There are two tax codes in America. The first is mandatory for workers who pay taxes out of every paycheck. The second is voluntary for billionaires who defer paying taxes for years, if not indefinitely.
“The billionaires income tax would ensure billionaires pay tax every year, just like working Americans. No working person in America thinks it’s right that they pay their taxes and billionaires don’t.”
Musk, who also owns SpaceX, was named by Forbes magazine as the first person worth more than $300bn. He has a history of controversial behaviour on Twitter.
Responding to Wyden’s original proposal, he tweeted: “Eventually, they run out of other people’s money and then they come for you.”
On Saturday, he said: “Much is made lately of unrealised gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock. Do you support this?
“I will abide by the results of this poll, whichever way it goes. Note, I do not take a cash salary or bonus from anywhere. I only have stock, thus the only way for me to pay taxes personally is to sell stock.”
By late Sunday morning more than 3.2 million people had voted: 57% said Musk should sell the Tesla stock and 43% said he should not. The poll was due to close early on Sunday afternoon.
In one response to the stunt, the Berkeley economist Gabriel Zucman tweeted: “Looking forward to the day when the richest person in the world paying some tax does not depend on a Twitter poll.”
When Wyden introduced his billionaires tax, Chuck Marr of the Center on Budget and Policy Priorities, a nonpartisan thinktank, used the example of Jeff Bezos, with Musk a competitor for the title of world’s richest person, to explain how the proposal would work.
The Amazon founder, Marr said, would contribute to the federal government on the basis of unrealised gains from his stock holdings, worth around $10bn, rather than a declared salary of around $80,000.
Citing a bombshell ProPublica report from June this year which showed how little Bezos, Musk and other super-rich Americans pay to federal coffers, Marr titled his analysis: “Why a billionaires tax makes sense – or why the richest people in the country should pay income taxes as if they were the richest people in the country.”
The Biden administration domestic spending plan which Wyden wants to help fund, known as Build Back Better, remains held up in Congress. House centrists are demanding nonpartisan analysis of its costs while centrist senators remain opposed to many of its goals.
Democrats are also split over the proposed billionaires tax. Among those opposed is Joe Manchin, the senator from West Virginia who with Kyrsten Sinema of Arizona stands in the way of Build Back Better, wielding tremendous power in a chamber split 50-50 and therefore controlled by the casting vote of Vice-President Kamala Harris.
Speaking to reporters in October, Manchin said: “Everybody in this country that has been blessed and prospered should pay a patriotic tax.
“If you’re to the point where you can use all of the tax forms to your advantage, and you end up with a zero tax-liability but have had a very, very good life and have had a lot of opportunities, there should be a 15% patriotic tax.”