Twitter is drawing backlash over its apparent inconsistencies as it allows an article detailing the secret tax records of billionaires to spread freely after censoring articles about Hunter Biden‘s laptop.
ProPublica refused to disclose how it obtained the tax data published on Tuesday, saying only said it was given the IRS data in ‘raw form’ by a party it did not identify.
In October, Twitter blocked users from sharing a New York Post article revealing damaging information from Hunter’s laptop, which had been abandoned in a repair store.
The social media site said at the time that the article violated its policy against publishing private information, as well as its prohibition on sharing hacked materials.
Critics lashed out at the apparent hypocrisy, with some even speculating that ProPublica chose not to delve into the finances of Twitter CEO Jack Dorsey and Facebook CEO Mark Zuckerberg to avoid bans from the social media giants.
Twitter is drawing backlash as it allows an article detailing the secret tax records of billionaires to spread freely after censoring negative articles about Hunter Biden’s laptop
‘So on what basis should BigTech have censored the NYPost story on Hunter Biden’s emails, but allow free sharing of the ProPublica tax report?’ tweeted Andy Grewal, a law professor at the University of Iowa.
‘I don’t think either should be censored … I’m just wondering about BigTech’s distinction,’ he added.
The trove of records published by ProPublica showed that Amazon founder Jeff Bezos paid no income tax in 2007 and 2011, while Tesla boss Elon Musk’s income tax bill came to zero in 2018.
Investor George Soros went three straight years – between 2016 and 2018 – without paying federal income tax, according to the records.
However, the secret tax records revealed no government corruption or illegal activity, and primarily served to illustrate how the tax code works — namely that capital gains are not taxed until stocks are sold.
‘Many will ask about the ethics of publishing such private data. We are doing so — quite selectively and carefully — because we believe it serves the public interest in fundamental ways, allowing readers to see patterns that were until now hidden,’ ProPublica explained.
HOW CAN THE SUPER-RICH PAY LOWER TAXES?
Many billionaires are able to reduce their federal tax bills using legal tax strategies.
Among the ways they can reduce tax bills are:
Making sizable donations to charity
The rich can reduce tax bills through the use of charitable donations.
They can deduct up to 60 percent of adjusted gross income with donations.
Investing in stocks to avoid wage income
The rich can reduce taxes by avoiding wage income, which can be taxed at up to 37 percent.
They can instead benefit from investment income, which is often taxed at 20 percent.
Paying themselves lower salaries
If the mega-rich pay themselves a lower salary, they can then take a higher portion of the income as dividends.
The lower salary is then taxed a normal rate. Dividends are often taxed the same as the capital gains rate, which is between 15 to 20 percent.
Another option is to opt for part of their compensation in their company stock options. Stock is usually only taxed when the options are exercised.
Some critics accused ProPublica of publishing the report to advance an ideological agenda, potentially using the information to rally support for Democratic tax policies.
ProPublica itself noted the report comes at a ‘crucial moment’ politically, noting President Biden’s desire to hike taxes on the wealthy.
‘This is really seedy,’ Wall Street Journal columnist Bill McGurn remarked in an interview with Fox News. ‘It’s also a crime to leak or hack into confidential information, and to do it for political purposes is really slimy.’
‘It is not an investigative journalism piece to expose illegal activity or government corruption, but rather uses illegally leaked private information of citizens to make ideological and political points,’ tweeted journalist Jeryl Beier.
IRS Commissioner Charles Rettig revealed during an already scheduled Senate Finance Committee hearing just hours later that authorities are investigating the leak of the tax data.
‘We have turned it over to the appropriate investigators, both external and internal,’ Rettig said.
The Treasury Department said multiple agencies were investigating, including the FBI, DC’s US Attorney’s Office and the Treasury’s Office of the Inspector General.
‘The unauthorized disclosure of confidential government information is illegal,’ a Treasury spokeswoman said.
In reviewing the tax data, ProPublica calculated what it called a ‘true tax rate’ for the billionaires by comparing how much tax they paid annually from 2014 to 2018 to how much Forbes estimated their wealth had grown in that same period.
This issue with the approach is that most billionaires draw very little income, and most of their wealth is in the massive holdings of stock that they own.
The IRS taxes both income and capital gains from stock appreciation, but does not consider gains or losses on stocks until the assets are sold. Capital gains tax rates are also typically lower than income tax rates.
‘I’m not sure it was worth whoever leaked this going to prison in order to reveal mainly that you don’t pay capital gains taxes on stocks until you sell them,’ journalist James Surowiecki tweeted of the ProPublica article.
Billionaire Carl Icahn told ProPublica that his adjusted gross income is misleading because his interest on his loans is higher.
‘I didn’t make money because, unfortunately for me, my interest was higher than my whole adjusted income,’ he said.
Icahn hit back at questions over whether he thought it was inappropriate he hadn’t paid federal income tax some years.
‘There’s a reason it’s called income tax,’ he said. ‘The reason is if, if you’re a poor person, a rich person, if you are Apple – if you have no income, you don’t pay taxes.
‘Do you think a rich person should pay taxes no matter what? I don’t think it’s germane. How can you ask me that question?’