The Saga of Elon Musk Not Paying Taxes

By Ana Perez, 9th Grade

Elon Musk, the richest man on Earth with a net worth of $263B, more than 40% of the general population, refuses to pay his taxes because he sucks. In 2018, he paid nothing in federal income taxes despite his fortune as a billionaire. So, why is it that the richest man in the world refuses to pay taxes? Greed and a general lack of empathy for the less fortunate. He says that the rich shouldn’t have higher taxes since the government shouldn’t control capital, but his three companies (SpaceX, Tesla, and SolarCity) have received billions in government subsidies. 

According to a Los Angeles Times investigation, all three of his companies have received $4.9 billion in government support by 2015, and they have gotten a lot more since – including 2018 when he paid nothing in federal income tax. In 2021, SpaceX received a $2.89 billion contract with NASA. In 2020, SpaceX signed a $653 million contract with the US Air Force for National Security Space “launch services” that will be provided between 2022 – 2027. In 2020, Tesla accepted “certain payroll benefits” from the federal government’s 2020 pandemic stimulus for corporations. Elon Musk opposed a stimulus bill for individuals, even though the billions he made during the pandemic, which made him the richest person on Earth, were thanks to this stimulus bill. In 2010, the federal government’s Energy Department loaned Tesla $456 million so they could make fuel-efficient cars. 

While federal income tax and his companies are two different things, we cannot deny that it is incredibly hypocritical of someone who became the wealthiest man on Earth, thanks to government subsidies, to refuse to pay his fair share to the government, which could fund various welfare programs to help the less fortunate. But he doesn’t care or needs to care about those less fortunate because he will never be in the same position as them. 

The problem? Musk should pay much higher taxes – but he refuses to. The richest 1% in the United States pay a federal income tax rate of 8% while the average income tax rate for the average worker in the United States was 22%. This is much lower than the ordinary person that does not have the ridiculous amount of resources the ultra-rich and elite have. Not only that, but the rich have found several loopholes to avoid taxes – such as simply making shell companies in Panama as exposed in the Panama Papers. And if the government doesn’t receive that money, they can’t invest more in welfare programs because of the deficit and inflation, which are just going to affect the economy negatively. To solve this problem, Democrats in the House have proposed a 39.2% top tax rate for the ultra-rich, which seems fair. Now, Elon Musk lives in Texas where the income he needs to live comfortably is around $100,000. 

If Elon Musk was taxed 39.2% on the $6.7B he made in 2020 simply for being a CEO, then he would still have $4.2B which is more than enough to live comfortably in Texas. Even if he was taxed the 70% that Rep. Alexandria Ocasio-Cortez proposed, he would still have millions, which is more than enough to live well in any part of the United States. Then why is Elon Musk so against paying his fair share, even though he made that money through government subsidies? Senator Elizabeth Warren stated: “Let’s change the rigged tax code so ‘The Person of the Year’ will actually pay taxes and stop freeloading off everyone else.” Elon Musk can say that he’ll pay $11B, but will he really? And even so, he owes much more than $11 billion because of his wealth of $300 billion. 2% of his wealth could immediately feed those suffering from world hunger, but he won’t pay that because he doesn’t need to or have to. Even though he can easily make that money back by selling just about 5% of his shares, that won’t really matter in the long-run because he’ll make the money back thanks to his investments. 

While taxes are what you need to pay the government, subsidies are what the government gives you. With how much money the government has given Elon Musk’s companies, isn’t it fair that he pays the taxes that he owes, which are going to help the less fortunate in the long-run? Elon Musk is against taxes because he does not believe that he owes the government anything, and he also doesn’t believe in subsidies because the government shouldn’t have “capital” even though he made his fortune thanks to subsidies. Ever since he became the richest man in the world, he has been ignoring the impact the government has had on his wealth. And he has promised that he will help the poor himself instead of relying on government support because he doesn’t “believe in the government.” But, while he promised to give 50% of his wealth to charity, he has only given less than 1%. 

If Elon Musk truly wants to help the less fortunate, he should just pay his taxes, because that could fund welfare programs: SNAP, Medicaid, TANF, CHIP, etc. That is what is going to help people because, if left to his own devices, he’s not going to donate to others now – when people need it the most.


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