Tech titans and taxes: Amazon paid none, Bill Gates wants to pay more
It’s a tale of two tech titans, and their taxes. While tech innovator Bill Gates says he should be paying more taxes, Amazon is avoiding paying them altogether.
Amazon has achieved record profits in 2018, but the company has reportedly not paid any federal taxes, according to a non-partisan tax policy group.
The Institute on Taxation and Economic Policy reports that while the online shopping giant raked in $11.2 billion in profits over 2018, it didn’t pay any federal taxes.
The company’s newest corporate filing reveals that, far from paying the statutory 21 percent income tax rate on its U.S. income in 2018, Amazon reported a federal income tax rebate of $129 million. For those who don’t have a pocket calculator handy, that works out to a tax rate of negative 1 percent. The fine print of Amazon’s income tax disclosure shows that this achievement is partly due to various unspecified “tax credits” as well as a tax break for executive stock options.
Federal law allows companies to reduce or wipe out their taxes when past losses and equipment purchases are taken into account. This isn’t the first year that Amazon has avoided federal taxes. Last year, Amazon paid no federal corporate income taxes on $5.6 billion dollars.
Meanwhile, tech titan Bill Gates was interviewed on CNN recently and said that the recent Trump tax package was regressive — that wealthier people like himself greatly benefited from the new tax structure, but others, not so much.
“It was not a progressive tax bill, it was a regressive tax bill,” Gates said. “People who are wealthier tended to get dramatically more benefits than the middle class or those who are poor.”
“I need to pay higher taxes,” he said. “….I’ve paid in absolute more taxes — $10 billion — than anyone, but the government should require people in my position to pay significantly higher taxes.”
Gates’ interview comes as proposals in Congress aim to get the richest Americans to pay a top marginal tax rate of 70 percent. But Gates said that approach wouldn’t work either. Instead, he believes increasing the capital gains tax would.
MyNorthwest contributed to this report.