Amazon Founder Bezos Says, "Let’s Eliminate Taxes for the Bottom Half"

[Financial News, New York = Reporter Lee Byung-chul] Amazon.com, Inc. founder Jeff Bezos argued that the federal income tax should be eliminated entirely for the bottom 50% of earners in the United States. As high inflation and living costs continue to weigh on Americans, the debate over easing the tax burden on middle- and low-income households is gaining renewed momentum.
In an interview with CNBC on the 20th local time, Bezos said, "The top 1% pay about 40% of total tax revenue, while the bottom half pays only 3%. That 3% should be eliminated too. It should be 0%."
Citing a nurse in Queens, New York, who earns about $75,000 a year, he said, "We should not be asking them to send money to Washington, D.C.; the government should be apologizing to them instead." He added, "The current situation makes no sense at all."
According to the Tax Foundation, the average gross income of the bottom 50% of U.S. earners was about $54,000 in 2023. By contrast, households in the top 1% earned at least $676,000. The average federal income tax rate for the bottom 50% was 3.7%, with an average tax bill of $913. The average rate for the top 1% was 26.3%, about seven times higher than that of lower-income groups.
Bezos made the remarks as debate over higher taxes on the wealthy is spreading within the Democratic Party. Recently, U.S. Senator Cory Booker of New Jersey introduced the Keep Your Pay Act, which would exempt the first $75,000 of joint income for married couples from taxation. Booker said, "We need to leave workers with more cash to cope with living costs and emergencies."
The debate is drawing particular attention amid growing polarization in the U.S. economy. Research from the Federal Reserve Bank of New York found that low-income households' spending power deteriorated sharply after government aid payments issued during the COVID-19 pandemic ended. Analysts have also said that the recent surge in gasoline prices following the Iran War has further increased the burden on low-income households, since they spend a larger share of their income on fuel.
Bezos also said, "The United States now has two economies operating at the same time." He added, "Some people are doing extremely well, but many others are struggling to make ends meet."
Still, the debate over higher taxes on the wealthy continues in the United States. According to the Tax Foundation, the top 1% accounted for about 21% of total gross income in 2023, but paid about 38% of all federal income taxes. By contrast, the bottom 50% accounted for 12% of total income, but only 3% of the tax burden.
Progressive think tanks, however, argue that the U.S. tax system actually favors the wealthy. The Budget Lab at Yale University said high-income earners are using the complexity of the tax code to significantly lower their effective tax rates. It found that some ultra-high-income earners pay as little as 3%, while others face rates as high as 45%.
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pride@fnnews.com Reporter Lee Byung-chul Reporter