Walmart

When citizens cry out that the rich should pay more taxes that is countered with the fact that the top one percent of wage earners pay 40% of all income tax but this is misleading. The rich do pay a disproportionate amount of income tax but many rich have very little taxable income. This is because most of their income comes not from wages but from assets. The children of Sam Walton do not earn wages and thus do not pay income tax. They live off of dividends from their Walmart stock where they pay capital gains tax and pass on their assets tax free to their heirs when they die. The four children of Sam Walton own 4 billion shares of Walmart stock valued at $250 billion. The Walmart dividend is 75 cents per share or $3 billion per year to the four children. They never touch the principal and it passes tax free to their children when the die. An investor who bought Walmart stock in 1972 for $1,000 would have $11.3 million today and if they died this would pass tax free to their heirs. This is because capital gains tax only come into play when the asset is sold. At death it has a stepped-up basis and escapes income tax. They skirt the estate tax by transferring ownership to trusts. The top one percent owns $55 trillion in assets and the government collected only $32 billion in estate tax last year.