Democratic Rep. Pramila Jayapal claimed in a recent tweet that billionaire Elon Musk paid an effective tax rate of only 3.27 percent from 2014 to 2018.
The data point comes from a 2021 ProPublica article that divulged tax information of some of America’s wealthiest citizens.
As the ProPublica article notes, much of billionaires’ wealth is derived from the value of their assets, such as stocks or property, not cash on hand. When those assets increase in value, so does the wealth of the owner. This does not correlate into actual money, however, until the assets are sold. Once an asset is sold, the money received qualifies as taxable income.