Automaker tops the list of American companies who pay out far more to their own bosses than they do in federal taxes
by Chris Chilton
March 14, 2024 at 09:00
Benjamin Franklin famously opined that the only things in life a man could be sure of were death and taxes. But then Franklin wasn’t running Tesla, or he’d have known that only death was unavoidable (and we imagine Elon Musk is working on that).
The world’s best-known EV brand hit the headlines again this week when it was named in a report listing 35 different firms from across the business spectrum in America that pay their bosses more than they pay in federal taxes. And Tesla wasn’t just on that list, it easily topped the table thanks to an absurd tax-to-pay ratio.
Number crunching by the Americans for Tax Fairness group revealed that Tesla paid its executives, including CEO Elon Musk, $2.5 billion between 2018 and 2022, but handed over -$1 million to the treasury over the same period. Yes, negative $1 million. It received $1 million from the government, despite earning $4.4 billion.
It’s worth pointing out that the pay figure, in that case, is distorted by remuneration for Musk himself that a Delaware judge recently declared over-generous, and that the amount of tax paid was low due to losses carried over from previous years. But the numbers are still shocking and are way out of line with what even the other companies named and shamed on the ATF list paid out.
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Second-place T-Mobile US, for instance, paid -$80 million in tax and $675 million to its top team between 2018 and 2022, and third-placed Netflix sent $236 million to the treasury and $652 million to its execs’ bank accounts. Ford, in sixth place, paid $121 million in taxes and $335 million to its bosses. But perhaps the most jaw-dropping stat from ATF’s report is that the combined net federal income tax bill of all 35 companies on the list over the five-year period was negative $1.72 billion.
There’s no accusation here that the firms in question did anything illegal. They were simply taking advantage of the lawful tax-minimizing options available to them. Donald Trump controversially slashed taxes for businesses with the introduction of a 2017 law whose details included a cut in the top rate of income tax from 35 percent to just 21 percent. Groups campaigning for fair taxation want it raised to 28 percent, claiming that the move would bring in $1.3 trillion in tax revenue over the course of a decade, The Guardian reports.
Source: Americans For Tax Fairness