Many of the uber-rich in US pay next to no income tax, Propublica claims

Amazon founder Jeff Bezos paid no income tax in 2007 and 2011, while Tesla founder Elon Musk's income tax bill was zero in 2018, according to a report from the nonprofit investigative journalism organisation Propublica.

Overall, the richest 25 Americans pay less in tax – an average of 15.8 per cent of adjusted gross income – than many ordinary workers do, once you include taxes for Social Security and Medicare, Propublica found.

Its findings are likely to heighten a national debate over the vast and widening inequality between the very wealthiest Americans and everyone else.

An anonymous source delivered to Propublica reams of Internal Revenue Service data onthecountry'swealthiestpeople, including Warren Buffett, Billgates,rupertmurdochand Mark Zuckerberg.

Propublica compared the tax data it received with information available from other sources. It reported that "in every instance we were able to check – involving tax filings by more than 50 separate people – the details provided to Propublica matched the information from other sources".

Using perfectly legal tax strategies, many of the uberrich are able to shrink their federal tax bills to nothing or close to it.

A spokesman for financier George Soros, who has supported higher taxes on the rich, told Propublica that the billionaire had lost money on his investments from 2016 to 2018 and so did not owe federal income tax for those years.

Mr Musk responded to Propublica's initial request for comment with a punctuation mark – "?" – and did not answer detailed follow-up questions.

The federal tax code is meant to be progressive – that is, the rich pay a steadily higher tax rate on their income as it rises. And Propublica found, in fact, that people earning between two million and five million dollars a year paid an average of 27.5 per cent, the highest of any group of taxpayers.

Above five million dollars in income, though, tax rates fell: The top .001 per cent of taxpayers – 1,400 people with income above 69 million dollars – paid 23 per cent. And the 25 very richest people paid still less.

The wealthy can reduce their tax bills through the use of charitable donations or by avoiding wage income (which can be taxed at up to 37 per cent) and benefiting instead mainly from investment income (usually taxed at 20 per cent).

President Joe Biden, in seeking revenue to finance his spending plans, has proposed higher taxes on the wealthy.

Mr Biden wants to raise the top tax rate to 39.6 per cent for people earning 400,000 dollars a year or more in taxable income, estimated to be fewer than 2 per cent of US households. The top tax rate that workers pay on salaries and wages now is 37 per cent.

Mr Biden is proposing to nearly double the tax rate that high-earning Americans pay on profits from investments. In addition, under his proposals, inherited capital gains would no longer be tax-free.

The president, whose proposals must be approved by Congress, would also raise taxes on corporations, which would affect wealthy investors who own corporate stocks.