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Don’t Be Fooled By Musk’s Twitter Performance

Don’t Be Fooled By Musk’s Twitter Performance

Bernie Sanders has been advocating for a wealth tax for years and made it a central part of his 2020 presidential election campaign. It was a controversial idea at the time, and remains so, with the latest response coming from Tesla CEO Elon Musk, the wealthiest person in the world. 

"We must demand that the extremely wealthy pay their fair share. Period," Sanders wrote on Twitter to his followers. 

One day later, Musk responded in a tweet to the 80-year Sanders by saying, "I keep forgetting that you’re still alive."

Sanders' tweet to his followers comes as the White House is trying to hike taxes for the super-rich, which would really impact only about 700 people, including Musk. 

U.S. Senate Democrats recently proposed to tax billionaires' stocks and other tradable assets to help to finance President Joe Biden's proposed $3.2 trillion social spending package, which has since been slimmed to $1.75 billion.

The Biden administration also plans to raise the corporate tax rate from 21% to 28%, reversing the lower corporate rate of 10.5% implemented by the Trump administration. 

According to a recent Pew Research Center survey, for 80% of Americans it is “a significant bother” that some corporations and wealthy people are avoiding their "fair share" of taxes, or avoiding paying any taxes at all. 

Back in June, a ProPublica investigation found that quite a few corporations don't pay a cent in income taxes. Based on 2018 IRS records, they found that Musk paid no federal income taxes.

Also, Amazon’s Jeff Bezos did not pay anything in federal income taxes in 2007 and 2011. Michael Bloomberg, Carl Icahn and George Soros also popped up on these lists. 

According to the investigation, the 25 richest Americans paid a “true tax rate” of just 3.4% between 2014 and 2018.

Earlier this month, Musk informed his followers on Twitter that he took no salary or bonuses from any of his companies, which means that he has no earnings on which to pay income tax.

However, in response to Sander’s "billionaires’ tax" tweet, Musk tweeted that he would sell 10% of his shares if users of the social media platform endorsed the move. About 57.9% of people voted for the stock sale. Last week, he sold nearly $7 billion in shares.

However, Musk would have likely started selling millions of shares in the coming months, regardless of the poll and the very public tweet-fest. 

According to CNBC, Musk would have had to sell millions of shares this year because he is facing a tax bill upwards of $15 billion stemming from a 2012 stock options award that serves as his compensation package. The gain on those options was nearly $28 billion. So few should be fooled by his public show of bowing to followers on Twitter, and appeasing Sanders.

Musk is well-known for his use of social media platforms as an instrument of influence. His tweets have been among the key drivers of Bitcoin prices, both up and down, for example--not to mention for Tesla itself. 

Earlier this month Tesla’s stock dropped 3% after Musk downplayed the $4.2 billion agreement with car rental company Hertz. Also, in May last year he tweeted that Tesla stock was too high which sent the company’s stock 10% down.

However, all those losses are usually short-lived and recovered within days. As for his response to Sanders, one former Sanders staffer, tweeted: “Folks, quit buying Tesla. Don’t reward abusive men.”

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