Biden pushed a billionaire minimum tax – here are the issues with it, and what Elon Musk would pay
During his State of the Union address, President Joe Biden urged Congress to pass his billionaire minimum tax.CNBC's Robert Frank breaks down how such a tax would affect a billionaire like Tesla CEO Elon Musk.Angela Weiss | AFP | Getty ImagesTuesday night when he proposed a new tax on the rich.. "Because no billionaire should pay a lower tax rate than a school teacher or firefighter.
The big change is taxing unrealized capital gains as income. Currently, if a taxpayer owns a stock, bond, real estate or other assets, they don't typically owe capital gains until it's sold. Biden proposes taxing "unrealized gains," meaning a tax on the annual paper gain in value even if it's not sold.
Yet taxing unrealized gains is increasingly complicated with today's wealthy – most of whom have fortunes tied to volatile tech stocks that swing wildly from year to year.If the billionaire minimum tax started in 2020, he would have owed a tax of $31 billion on his total net worth, which at the start of the year was $156 billion.In 2022, however, his net worth fell by $115 billion on's stock decline.
"Applying the tax to tech stocks, and other assets that are volatile, is tricky," said Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center.
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