Elon Musk would have paid $4.6 billion in 2020 under Warren's wealth tax proposal, data shows

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Grace Dean
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Elon Musk
Tesla and SpaceX CEO would be hit heavily by the tax. PETER PARKS/AFP via Getty Images
  • Musk would have paid $4.6 billion in 2020 under Warren's "ultra-millionaire" plan, tax groups said.

  • The Tesla and SpaceX CEO was worth at least $150 billion at the end of 2020.

  • Musk plans to use his fortunes to fund a future colony on Mars.

  • Visit the Business section of Insider for more stories.

Elon Musk would have paid $4.6 billion in 2020 under proposals for an "ultra-millionaire" tax, data from tax groups shows.

Sen. Elizabeth Warren of Massachusetts proposed the Ultra-Millionaire Tax Act Monday. It would apply an annual 2% tax on individual net worth between $50 million and $1 billion, or 3% on net worth above $1 billion.

If this tax had been in place in 2020, Musk would have paid the second most of all Americans, beaten only by departing Amazon CEO Jeff Bezos, Americans for Tax Fairness (ATF) and the Institute for Policy Studies (IPS) Project on Inequality said, basing their calculations on Forbes data. Musk would be followed by Microsoft co-founder Bill Gates and Facebook CEO Mark Zuckerberg, the groups said.

The nation's roughly 650 billionaires have a collective wealth of more than $4.2 trillion, the groups said. Their fortunes have increased by about 44% since March 2020, when the pandemic lockdowns in the US started, and over a decade the wealth tax on those 650 billionaires alone would fund about three-quarters of President Joe Biden's $1.9 trillion coronavirus relief package, the ATF and IPS said.

About a third of the wealth tax would be paid by the 15 richest Americans alone, who combined have a fortune of more than $2.1 trillion, they added.

Musk has grown richer and richer over the past year

At the end of 2020, Musk's real-time worth was $153.5 billion according to Forbes and $170 billion, according to Bloomberg. Both rich lists said his wealth increased more than sixfold within a year.

Based on Forbes' figures, Musk would have paid $4.6 billion last year under Warren's proposal. Using Bloomberg's figures, this would have been $5.1 billion.

Musk and Bezos have been flip-flopping as the world's richest person since January. As of March 5, Bezos tops both Forbes and Bloomberg's lists. Musk is worth $152.4 billion, according to Forbes and $162 billion, according to Bloomberg.

Musk made his fortune from his business empire. He is the CEO of both Tesla and SpaceX, founder of Neuralink, and co-founder of the Boring Company.

Though he takes the minimum legally allowed salary from Tesla, Musk's compensation package awards him stock when Tesla achieves certain goals, making him the world's highest-paid executive last year. He has a roughly 20% stake in Tesla, as well as 57 million vested Tesla stock options, according to Bloomberg.

He also has a 48% stake in his aerospace company, SpaceX. A February 2021 funding round valued SpaceX at $74 billion.

Musk has ambitious plans for his fortunes. In December, he told Mathias Döpfner, the CEO of Insider's parent company, Axel Springer, that he was selling all his possessions to fund a future colony on Mars.

"In fact, I'll have basically almost no possessions with a monetary value, apart from the stock in the companies," Musk said. "If things are intense at work, I like just sleeping in the factory or the office. And I obviously need a place if my kids are there. So, I'll just rent a place or something."

Musk also recently sold several expensive pieces of property, including three neighboring homes in the Bel-Air neighborhood of Los Angeles.

Read the original article on Business Insider