Jeff Bezos says bottom half of earners should pay zero income tax

Amazon Executive Chairman Jeff Bezos on Wednesday called for zero federal income taxes for the bottom half of earners.

Bezos told CNBC’s Andrew Ross Sorkin that the top 1% of taxpayers pay about 40% of all tax revenue, while the bottom half pays 3%.

“I don’t think it should be 3%,” Bezos said. “I think it should be zero.”

The bottom half of taxpayers will have an adjusted gross income of nearly $54,000 in 2023, according to the Tax Foundation, citing the latest IRS statistics. In contrast, the top 1% of households earned at least $676,000 that year.

Bezos said low-income people pay “a small amount in taxes for the government,” citing the hypothetical example of a healthcare worker making $75,000 a year.

“We shouldn’t be asking this nurse in Queens to send money to Washington,” he said. “They should send her an apology. It really makes no sense.”

He said he would “support” such a change, but did not elaborate on how lawmakers would enact it.

Bezos is the fourth richest person in the world, with a net worth of about $269 billion, according to Forbes magazine.

Bezos’ comments come as many Democratic states are considering raising taxes on the wealthy.

Several members of Congress have also recently proposed tax cuts for low-income earners. Sen. Cory Booker (D.N.J.) proposed the Paycheck Maintenance Act. It calls for making the first $75,000 of income tax-free for households filing a joint tax return and reducing proportional taxes for single filers and heads of households.

“No income tax on the first $75,000 earned by households would be a game-changer for working people,” Booker said in a statement announcing the bill on March 9. “This tax cut will immediately put more money in your pocket every month to cover everyday expenses, unexpected emergencies, or future plans.”

The average income tax rate in 2023 was 14.1%, according to an analysis of IRS data by the Tax Foundation. The average tax rate for the top 1% of taxpayers is 26.3%, seven times the average tax rate of 3.7% paid by the bottom half of taxpayers.

According to the Tax Foundation, by 2023, the number of households in the bottom half will exceed 76 million. That same year, they paid an average of $913 in federal income taxes.

But once refundable tax credits are taken into account, the bottom 40% of taxpayers already pay no income taxes on average, said Erica York, vice president of federal tax policy at the Tax Foundation.

Although the bottom half of income earners have a lower tax burden, their plight has become more pronounced amid widespread concerns about rising inflation and affordability.

The so-called K-shaped economy represents a different experience for Americans. While high-income households continue to benefit from rising markets and wages, many low- and moderate-income consumers are struggling with higher costs and financial strain.

Research from the New York Fed shows that the expiration of pandemic-era subsidies for low- and moderate-income households has created a significant divergence in 2023. More recently, researchers found that the sharp rise in gasoline prices during the Iran war exacerbated the K-shape. Low-income earners spend a higher percentage of their income on gasoline than high-income earners.

“I think what’s going on is this is kind of a story of two economies. So there’s a lot of people in this country who are doing very well, but there’s also a lot of people in this country who are struggling,” Bezos said.

The concept of whether wealthy people pay their fair share of taxes compared to lower-income people has long been the subject of intense debate.

Critics of raising taxes on high-income earners often point to the progressive nature of the federal tax code.

For example, the top 1% of taxpayers accounted for nearly 21% of adjusted gross income in 2023, but paid a much larger share of all federal income taxes that year, about 38%, according to the Tax Foundation, citing IRS data.

Meanwhile, the bottom half of taxpayers account for 12% of total income, but only pay 3% of the total income tax.

Imposing higher taxes on the wealthy could reduce the amount of money they save and invest, said Thomas Savidge, a research fellow at the American Institute for Economic Research, a free-market think tank that advocates for limited government.

Its savings and investment activities generally “bring access to capital to everyone, enable people to create and innovate, and make everyone wealthier,” he wrote in 2025.

But a 2024 report from the Yale Institute for Budget Studies found that high earners often take advantage of the “complexities of the tax code” to reduce their IRS bills, paying effective tax rates that are “much lower” than they would have to pay on paper.

However, it turns out that tax burdens can vary widely even among the wealthiest households.

For example, the top 1% of taxpayers pay an effective tax rate of 3%, while others pay rates as high as 45%, according to an analysis by Budget Lab.

Some groups favoring higher taxes on the wealthy argue that the U.S. tax system is not as progressive as it seems when you look beyond individual income taxes and look at household taxes more comprehensively.

Payroll taxes are the largest tax many people pay, and people with incomes above $184,500 don’t owe Social Security taxes, according to a recent blog post by Jessica Vera, a federal policy analyst at the Institute on Taxation and Economic Policy, a progressive think tank. Millions of dollar earners stopped paying their Social Security benefits for 2026 in early March, according to estimates from the Center for Economic Policy Research.

Low-income earners also spend a higher percentage of their income on sales taxes at the state and local level compared to higher-income earners, contributing to a more regressive tax system, Berra wrote.

Considering all federal, state, and local taxes paid by U.S. households, the top 1% of households account for 24% of total tax receipts, just slightly more than their share of reported income of 20%, according to the 2024 ITEP analysis.

The analysis says this does not include so-called unrealized capital gains, or untaxed profits earned on stocks and other assets disproportionately owned by the wealthy.

—CNBC’s Jessica Dickler and Kate Doerr contributed reporting.