Microsoft co-founder Bill Gates makes an ardent plea for a fairer tax system in America – and makes several suggestions as to what this might look like. Several times he also refers to his own biography.
Bill Gates is the second richest man in the world. According to the financial data provider Bloomberg, his wealth currently amounts to 113 billion dollars, only ahead of him is Amazon founder Jeff Bezos. Gates has also become a multi-billionaire through a successful company formation – he created the software manufacturer Microsoft and became wealthy essentially through the stake in the company, which investors on the stock exchange currently hold for more than $ 1.2 trillion.
Gates has long since withdrawn from day-to-day business. When he appears in public or gives interviews, he often speaks about the endeavors of the foundation, which he runs together with his wife Melinda. About new inventions, the fight against terrible diseases or the future nutrition of mankind. At the turn of the year he wrote a detailed article on a much more sober topic: the American tax system. “It’s not the most social theme for the holidays, but it’s one of the most important debates taking place in our country right now,” Gates wrote.
“Dynastic system not good”
He complains that inequality in the United States has increased enormously and is still growing. The difference between the highest and lowest incomes in the world’s largest economy is significantly greater than it was 50 years ago. “Few of them end up with a lot – I was rewarded disproportionately for the work I did – while many others who work just as hard struggle to make ends meet.”
That is why he is basically in favor of a tax system in which those who have more money also pay more taxes in percentage terms. “I think the rich should be paying more than they are now, and that includes Melinda and me,” he continues.
Specifically, Gates proposes a whole series of measures: In general, capital should be taxed more heavily, including through a higher capital gains tax. Nowadays the American state is largely dependent on taxing labor, i.e. wages and salaries. “But the wealthiest usually get only a tiny percentage of their income from a salary; Most of it comes from profits from investments like stocks or real estate. “
In addition, Gates advocates a higher inheritance tax. And not just for the sake of justice. “A dynastic system in which immense wealth can be passed on to children is not good for anyone; the next generation does not have the same incentive to work hard and to contribute to the economy. ”This is one reason why he and his wife put most of their joint assets into the foundation and do not pass them on to the children.
High budget deficit
At the same time, Gates urged that taxes be raised very carefully. One reason inventors come to America is that it is relatively easy for them to start a business, invest capital and make a profit there. “We shouldn’t destroy these incentives, but we are still a long way from that.”
Gates believes the wealthiest percent of Americans can pay much more before they stop working or create jobs. And he points to his own past: “In the 1970s, when Paul Allen and I founded Microsoft, marginal tax rates were almost twice as high as they are today. That didn’t hurt our incentive to build a great company. “
Finally, Gates also commented in the article on why he does not simply voluntarily pay higher taxes than he is required by law if this is necessary. “The answer is that simply letting people give more than the government demands is not a scalable solution. People pay taxes based on their legal obligations and citizenship, not out of charity. ”Additional voluntary donations would not raise enough funds for everything the government had to do.
Incidentally, Gates also expressly justifies his plea for higher public revenues with the development of American public finances. Without naming President Donald Trump, during whose term of office the budget deficit has reached enormous proportions, the Microsoft founder simply states that tax revenues are significantly smaller than government spending.
The discussion about whether or not inequality is too great also plays a role in the looming presidential campaign in America. The candidates Elizabeth Warren and Bernie Sanders, for example, who are competing for the Democratic mandate, advertise a higher financial burden on the wealthiest.