Naming his latest legislation the ROBINHOOD Act, Rep. Dan Goldman (D-NY) targets mega-billionaires Elon Musk and Jeff Bezos, namechecking the two business titans and calling out what he says are their effective tax rates, a mere 1% and 3.3% respectively, according to Goldman.
Using Bezos and Musk as prominent examples, Goldman — himself a very wealthy man — contends that the wealthiest Americans pay far less than their fair share of taxes, especially due to a common financial maneuver that involves using tax-free loans for expenditures, borrowed against assets they hold.
Goldman proposes taxing those loans, which he views as a tax dodge, asserting the change would generate more than a quarter trillion dollars in revenue, which the Congressman suggests be put to use for universal childcare — an initiative that most Americans support.
[NOTE: In a poll of Republican primary voters, “71% of voters polled said making child care more affordable is one of the most pro-family, pro-worker actions that government can take. Additionally, 53% believe the government helping parents access high-quality child care, and 72% want Congress to reduce the financial burden of child care for working parents.”]
Elon Musk paid an effective tax rate of 3.3%. Jeff Bezos paid 1%.
How? They take out tax-free loans against their stock.
Today I’m introducing the ROBINHOOD Act to tax these loans and generate at least $276B for universal childcare and other programs to restore access to the… https://t.co/hT0Lv58iYz
— Rep. Dan Goldman (@RepDanGoldman) December 4, 2025
Taxes are a complex issue and numerous commenters reject Goldman’s claim that Bezos, Musk and company really pay such a small “effective” tax rate.
(The top comment on Goldman’s X post announcing the bill objects, saying the word “effective” — as Goldman uses it “is doing a lot of work here because you are counting things that are not income as income. Neat trick. You could actually make this number anything you want by counting other non-income as income.”)
Yet there is little question that the types of loans Goldman wants to tax are used by the wealthy in exactly the manner he says — part of what is sometimes called a ‘Buy, Borrow, Die‘ plan to avoid taxes and pass on generational wealth.
[NOTE: CNBC reported in October that “the top 1% have seen their wealth increase by $4 trillion over the past year, an increase of 7%. Their wealth hit a record $52 trillion in the second quarter.]
Whatever Bezos and Musk’s potential objections, there is some agreement even among the very rich — Goldman and wealthy California Rep. Sara Jacobs among them — that the current tax system puts too much of the burden on middle and lower income earners.
One group of very wealthy people, including Disney heiress and filmmaker Abigail Disney, have formed an organization — Patriotic Millionaires — devoted to making the rich, like themselves, pay more.
[Note: From 1944 to 1963, the top marginal tax rate in the U.S. was 91%, which applied to income over $200,000. “Despite these high marginal rates,” the Tax Foundation explains, “the top 1 percent of taxpayers in the 1950s only paid about 42 percent of their income in taxes.” Still a far cry from the effective tax rates Goldman says the current top 1 percent enjoy.]
Famous billionaire investor Warren Buffett, known as the Oracle of Omaha for his foresightedness, has also famously lamented a tax system in which his secretary paid a lower effective tax rate than he did.
“I continue to believe that the tax code should be changed substantially,” Buffett said in 2021. “I hope that the earned-income tax credit is increased substantially and additionally believe that huge dynastic wealth is not desirable for our society.”