He is regularly invited to spread the gospel of Benioff, as he did in April at NationSwell Summit West, a conference designed to “feature creative, cutting-edge solutions and the problem-solvers behind them.” From the back of a small hall, I watched him deliver a rollicking stream of thoughts on his family roots, negativity, writing down intentions, his friend Stevie Wonder, and radical trust. (“Can you even hold fear in your mind if you truly have radical trust?”) But the heart of his remarks, delivered to this room full of business, tech, VC, nonprofit, and philanthropy types, was clear: From immigration to plastic in the ocean, enlightened leaders have no shortage of opportunities to make a better world. This led him to recall his role in Prop. C.
“What I was not expecting was a huge surge against me by many, many, many business leaders, who are friends of mine, close friends of mine, who are completely opposed to paying any kind of taxes … We’re in a world where we have to look at taxes as a key part of the solution,” he said. Mentioning corporate tax rates, individual tax rates, and city tax rates, he added that “we’ve got to look at that as part of the solution.”
The room broke out in applause. Just 16 months earlier, in 2017, Congress had passed President Trump’s Tax Cuts and Jobs Act, the largest tax overhaul in more than three decades. The law lowered the top marginal tax rate for individuals from 39.6 percent to 37 percent and reduced corporate rates from 35 percent to 21 percent. It was a love letter to the very wealthiest, written hastily behind closed doors. Those new cuts, atop years of tax avoidance, cuts to estate taxes, and rising payroll taxes, meant that, for the first time ever recorded, the 400 richest Americans are now paying a lower overall tax rate than almost anyone else, according to a study by two UC Berkeley economists.
Benioff possesses an acute awareness of this reality. He has called for increasing taxes “on high-income individuals like myself” to “generate the trillions of dollars that we desperately need to improve education and health care and fight climate change.”
But it’s worth noting a few asterisks in his call to arms. For one, Prop. C taxes certain sectors differently than others, making it more burdensome to, say, a fintech company like Square, which would have to pay twice as much tax as Salesforce, despite bringing in a fraction of its revenue. But more important is the part Benioff never mentions: the zero dollars his company paid in federal income tax that year, according to the Institute on Taxation and Economic Policy.
“This is a company that had $7.8 billion in gross profit in 2018 and didn’t pay a dime in federal income tax,” Frank Clemente, executive director of Americans for Tax Fairness, told me, before running through the assorted mechanisms used by the country’s corporations to avoid contributions to the federal treasury: patents held by foreign subsidiaries. The so-called stock options loophole, which allows companies to lower their taxable income by paying executives in stock options. Offshore accounts. (As of 2017, Salesforce had 14 tax haven subsidiaries, in Hong Kong, Luxembourg, Singapore, the Netherlands, Switzerland, and Ireland, according to a report from the advocacy group US PIRG and ITEP.)
To put it in further perspective, the tax burden Salesforce stood to face under Prop. C amounted to roughly $10 million a year—a fraction of what a multibillion-dollar company’s federal income tax would be without those loopholes.
Benioff was whisked away after the NationSwell event; asking him questions was proving difficult. It wasn’t that Benioff owed me anything. He’s a private citizen. But at the same time, he’s not a private citizen. Without running for office, he’s attained a phenomenal level of influence; the San Francisco Business Times called him “the most influential man in San Francisco.” If a local elected official had as much power and sway as Benioff, they’d feel some responsibility to answer to the press.
social experiment by Livio Acerbo #greengroundit #wired https://www.wired.com/story/gospel-of-wealth-according-to-marc-benioff