The effective tax rate for the richest 0.0002% of America – about the billionaires on the Forbes 400 list – fell from 30% to 24% after the GOP tax over -2017, according to a new study by the National Bureau of Economic Research.
Billionaires avoid more taxes after Gop has been lowered
The congress has expanded those cuts last month under what President Donald Trump called his “big, beautiful bill”.
Rates out of balance
For comparison: the average effective tax rate for the American population is 30%, while the top wage earners prove closer to 45%. For the 100 richest Americans, however, the rate is only 22%, which emphasizes an imbalance in the system, reported The hill.
The study, written by University of California Economists Emmanuel Saez And Gabriel Zucmanfound the tax cuts and job law of 2017 a turning point. “The tax rate of the Top 400 decreased considerably at the end of our sample,” the researchers wrote, where the decrease was linked directly to the GOP legislation.
Rising Wealth Share
In 1982, the wealth of the top 0.0002% was about 2% of the US’s gross domestic product. By 2025 it had grown to 20% of GDP, with almost three -quarters of the increase in the top 100 individuals, according to Saez and Zucman.
Shift in taxation
Taxes on wealth, measured as a share of interests instead of income, fell from 2.7% before the cutbacks on 2017 to only 1.3% thereafter. The US does not directly tax the wealth, although the Supreme Court recently indicated an interest in revising proposals for a federal wealth tax.
Much of the reduction comes from business structures. Many billionaires report a low private business income, with pass-through entities that generate paper losses that compensate for other taxable profits. The reduction of corporation tax of the law, from 35% to 21%, made major savings to the billionaire class.
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Burning of the rates
Zucman and colleagues calculated that from the effective tax rate of the top 400 of 23.8%, about 9% comes from corporation tax, which underlines how the policy is shifting, reformed liabilities at the top.
Impact on lower earners
The Congressional Budget Office found that expansion of the cutbacks in July wealth of Americans with a lower income to the well -to -do. Reduces to health care and other social programs reduced the means for poorer households, while tax savings were most difficult to the top 10%.
The United Nations reported in 2018 that the 26 richest people worldwide had as much wealth as the poorest half of humanity, around 3.8 billion people.
Rising class structure
Scholars claim that this dynamic marks the rise of a new global class. Economic Robert Brenner and sociologist Dylan Riley The trend described in 2022 as “politically manipulated upward redistribution”, a system in which the policy is consistently the richest.
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