https://www.wsj.com/finance/billionaires-low-taxes-are-becoming-a-problem-for-the-economy-27a560ca
But debate about how much tax billionaires pay is likely to grow as America’s fiscal situation deteriorates and its wealth gap widens. Data from the Federal Reserve shows that only the richest 1% of households have grown their share of overall U.S. wealth since 1990. Their share hit a record 32% in the third quarter of 2025, equivalent to $54.8 trillion.
Gains made by the billionaire class, the very top 0.1% of households and a subset of the 1%, have eclipsed the merely extremely rich. This group’s share of U.S. net wealth has risen nearly 6 percentage points to 14.4% since 1990.
Meanwhile, the bottom half of American households have lost ground. Their 2.5% cut of the country’s wealth has slipped from 3.5% in 1990. Also striking: The share owned by the decile of wealthy households that rank just below the top 1% has shrunk slightly.
billionaires aren’t captured by this picture because most of their wealth lies outside the income-tax system.
Billionaires have ways to lower their tax bills that aren’t available to most Americans. A common strategy is to avoid salaries, which are heavily taxed. Ray Madoff, a law professor at Boston College and author of The Second Estate: How the Tax Code Made an American Aristocracy, points to Mark Zuckerberg’s dollar-a-year wage at Meta. Warren Buffett took an annual salary of $100,000 for decades.
Billionaires prefer to be paid in shares, which are subject to capital-gains taxes when sold. But they don’t need to sell to fund their lifestyles. Billionaires use borrowed money for living expenses, pledging their shares or other assets as collateral. The interest on the debt is much lower than a capital-gains tax bill would be, and their stock portfolios can continue accumulating paper gains.
A third of America’s billionaires have inherited their wealth.
Billionaires put less into the tax pot as a percentage of their wealth than wage earners. One working paper by the National Bureau of Economic Research found that the effective tax rate for the U.S.’s 400 wealthiest individuals is 24%—compared with 45% for top labor income earners.
Who would have thunk the WSJ would publish such an article.
Has the USA become a feudal state that has royalty?