How much do billionaires pay in taxes?

Answer 1

Billionaires often pay a relatively low effective tax rate compared to their income due to the structure of the tax system, which taxes income from investments at lower rates than ordinary income. Many billionaires utilize tax strategies such as deductions, credits, and deferrals, which can significantly reduce their tax burden. Additionally, some of their wealth is tied up in assets that are not taxed until sold, leading to a situation where their reported income and actual wealth accumulation may not align. Consequently, their tax contributions can be a fraction of their overall wealth growth.