Amazon founder Jeff Bezos’ recent relocation to Miami, Florida, saved him close to $1 billion in taxes on his latest stock sales after he fled Washington State, which has a state capital gains tax.
CNBC reports that Jeff Bezos, the billionaire founder of Amazon, has made headlines once again, not just for his massive stock sales but for the substantial tax savings that come with his recent move to Miami. In a series of transactions that have caught the attention of financial analysts and tax experts alike, Bezos has sold and plans to sell a total of 75 million Amazon shares, worth approximately $13.5 billion at current market prices.
The timing of these sales is particularly noteworthy, coming shortly after Bezos announced his departure from Seattle, Washington, where he had resided for nearly three decades. While Bezos cited proximity to family and Blue Origin operations as reasons for the move, the financial benefits cannot be ignored.
Washington state implemented a seven percent capital gains tax on stock and bond sales exceeding $250,000 in 2022. This new levy marked the first time Bezos would have faced state taxes on his substantial stock sales. In contrast, Florida, Bezos’ new home state, boasts no state income tax or capital gains tax, creating a significant financial incentive for high-net-worth individuals like Bezos.
The tax implications of this move are staggering. Based on his initial sale of 50 million shares earlier this year, Bezos is estimated to have saved over $600 million in taxes. With the additional planned sale of 25 million shares, as revealed in a recent regulatory filing, his total tax savings could approach $1 billion.
This situation has reignited debates about state tax policies and their impact on wealthy residents. Washington state’s capital gains tax, which went into effect in 2022, brought in $786 million in its first year, exceeding projections. Interestingly, more than half of this revenue came from just ten individuals, highlighting the outsized impact of high-net-worth taxpayers on state income.
However, the tax’s second year saw a decrease in revenue to $433 million, despite a similar number of returns, raising questions about the predictability and sustainability of such targeted tax measures.
The tech industry, in particular, has been vocal about the potential consequences of the capital gains tax. Critics argue that it could drive away companies and talent, particularly given the importance of stock-based compensation in the sector. Some business leaders had warned that the tax might lead to an exodus of wealthy individuals and companies from Washington state.
Bezos’ move seems to back up these concerns, although it’s worth noting that he did not explicitly cite tax reasons for his relocation. The situation has also sparked a broader conversation about tax policy and wealth distribution. Washington state, which has no personal or corporate income tax, relies heavily on sales, property, and business taxes for revenue. Critics argue that this system is regressive, disproportionately affecting lower-income residents.
Read more at CNBC here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
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