Amazon Government Chairman Jeff Bezos on Wednesday referred to as for zero federal revenue taxes on the underside half of earners.
The highest 1% of taxpayers pay about 40% of all of the tax income, and the underside half pay 3%, Bezos instructed CNBC’s Andrew Ross Sorkin on “Squawk Field.”
“I do not assume it must be 3%,” Bezos mentioned. “I feel it must be zero.”
The underside half of taxpayers had an adjusted gross revenue of almost $54,000 in 2023, in keeping with the Tax Basis, citing the latest IRS statistics. In contrast, households within the high 1% earned at the very least $676,000 of revenue that yr.
Bezos mentioned the revenue tax paid by decrease earners is “a small sum of money for the federal government,” and supplied the hypothetical instance of a healthcare employee who makes $75,000 a yr.
“We should not be asking this nurse in Queens to ship cash to Washington,” he mentioned. “They need to be sending her an apology. It actually is senseless.”
He mentioned he would “advocate” for such a change, however didn’t supply particulars on how lawmakers may enact it.
Bezos is the world’s fourth-richest individual, with a web price round $269 billion, in keeping with Forbes.
Tax burden on low earners
Bezos’ feedback come as quite a few Democratic states discover larger taxes on the rich.
A number of federal lawmakers have additionally not too long ago launched proposals to chop taxes for decrease earners. Sen. Corey Booker, D-N.J., proposed the Maintain Your Pay Act, which requires the primary $75,000 of revenue to be tax-free for households submitting joint tax returns, with proportional tax aid for single filers and heads of households.
“No revenue tax on the primary $75,000 households earn could be a recreation changer for working individuals,” mentioned Booker in a assertion saying the proposed laws on March 9. “This tax reduce would instantly put more cash in your pocket each month to cope with the excessive worth of on a regular basis bills, an surprising emergency, or to plan for the long run.”
The common revenue tax charge in 2023 was 14.1%, in keeping with a Tax Basis evaluation of IRS information. The highest 1% of taxpayers paid a median charge of 26.3%, seven instances larger than the three.7% common charge paid by the underside half of taxpayers.
There have been greater than 76 million households within the backside half in 2023, in keeping with the Tax Basis. They paid $913 of federal revenue taxes, on common, that yr.
Nevertheless, when counting refundable tax credit, the underside 40% of taxpayers already pay no revenue tax, on common, mentioned Erica York, vice chairman of federal tax coverage for the Tax Basis.
‘A story of two economies’
Whereas the underside half of earners have a decrease tax burden, their struggles have been extra pronounced amid larger inflation and broader issues about affordability.
The so-called Okay-shaped financial system illustrates Individuals’ diverging experiences: Greater-income households proceed to profit from rising markets and wages, whereas many lower- and middle-income customers wrestle with larger prices and monetary pressure.
Federal Reserve Financial institution of New York analysis exhibits that the expiration of pandemic-era subsidies for low- and middle-income households created a noticeable divergence in 2023. Extra not too long ago, sharply larger gasoline costs amid the Iran conflict are exacerbating the Okay-shape, researchers discovered. Decrease earners spend a larger share of their incomes on gasoline relative to larger earners.
“I feel what is going on on is that it is type of a story of two economies, so you might have a bunch of individuals on this nation who’re doing rather well, however you even have a bunch of individuals on this nation who’re struggling,” Bezos mentioned.
Do the wealthy pay their justifiable share?
Jeff Bezos speaks with CNBC’s Squawk Field from Merrit Island, Florida on Could twentieth, 2026.
CNBC
The notion of whether or not the rich pay their justifiable share of taxes relative to decrease earners has lengthy been a topic of fierce debate.
Critics of elevating taxes on larger earners typically level to the progressive nature of the federal tax code.
For instance, the highest 1% of taxpayers accounted for almost 21% of complete adjusted gross revenue in 2023 — however paid a a lot bigger share, about 38%, of all federal revenue taxes that yr, in keeping with the Tax Basis, citing IRS information.
In the meantime, the underside half of taxpayers accounted for 12% of complete revenue, however simply 3% of complete revenue taxes paid.
Inserting a better tax burden on the wealthy might cut back the sum of money that they save and make investments, in keeping with Thomas Savidge, a analysis fellow on the American Institute for Financial Analysis, a free market assume tank that promotes restricted authorities.
That saving and funding exercise usually “creates entry to capital for all, permitting individuals to create and innovate, making everybody wealthier,” he wrote in 2025.
Nevertheless, excessive earners typically use the “intricacies of the tax code” to chop their IRS payments, and so they pay an efficient charge that’s “far much less” than the speed they need to pay on paper, in keeping with a 2024 report by the Yale College Price range Lab.
That mentioned, tax burdens can vary broadly even among the many richest households, it discovered.
For instance, some taxpayers within the high 1% pay an efficient tax charge of three% whereas others pay as excessive as 45%, in keeping with the Price range Lab’s evaluation.
Some teams in favor of elevating taxes on the rich say that the U.S. tax system is not as progressive as it might appear, when taking a extra holistic view of family taxes past the non-public revenue tax.
Payroll taxes are the largest levy that many individuals pay, and people for Social Safety aren’t owed on revenue above $184,500, in keeping with a current weblog submit by Jessica Vela, a federal coverage analyst on the Institute on Taxation and Financial Coverage, a progressive assume tank. Million-dollar earners stopped paying into Social Safety for 2026 in early March, the Middle for Financial and Coverage Analysis estimated.
Low earners additionally spend a larger share of their revenue on gross sales taxes on the state and native degree relative to larger earners, contributing to a extra regressive tax system, Vela wrote.
When accounting for all federal, state and native taxes paid by U.S. households, the highest 1% account for twenty-four% of complete tax income — solely barely larger than their share of reported revenue, 20%, in keeping with an ITEP evaluation in 2024.
This does not account for so-called unrealized capital good points, or the untaxed income from shares and different belongings which might be disproportionately owned by the rich, in keeping with the evaluation.
— CNBC’s Jessica Dickler and Kate Dore contributed reporting.
