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Business Insider
Posted on: September 5, 2024 at 13:19:54 CT
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The richest person in the world says he doesn't want any help from the US government, but his companies have actually gotten billions of dollars worth.
Like many other wealthy Americans, Musk has spoken out against a proposed "billionaires' tax" from Sen. Ron Wyden, writing on Twitter in October that "eventually, they run out of other people's money, and then they come for you."
More recently, he spoke out against government subsidies and tax incentives for US businesses. In a recent interview with TIME, he said the government was not a good "steward of capital."
And at a Wall Street Journal summit this month, Musk said the government should "just delete" all subsidies from the $1 trillion infrastructure bill President Joe Biden recently signed into law. Biden's bill included $7.5 billion for electric vehicle charging infrastructure, which would seem to help one of Musk's companies, Tesla Motors.
However, over the years, Musk's companies — Tesla Motors, SpaceX, and SolarCity — have received billions of dollars from government loans, contracts, tax credits, and subsidies. According to a Los Angeles Times investigation, Musk's companies had received an estimated $4.9 billion in government support by 2015, and they've gotten more since.
Here's a look at some of the federal and state-level government subsidies that have contributed to building Musk's empire.
In April, NASA selected Musk's aerospace company SpaceX for a $2.89 billion contract to work toward landing "commercial" humans on the moon. Musk beat out Jeff Bezos's aerospace manufacturer Blue Origin for the contract, which gives NASA use of Musk's Starship spacecraft to take astronauts from lunar orbit to the moon. Musk's company has been developing the spacecraft with the intent of taking the first humans to Mars.
The US Air Force has joined in on the SpaceX action as well. In 2020, Musk's SpaceX and United Launch Alliance won two contracts for National Security Space "launch services" worth a combined $653 million, which they will provide between 2022 and 2027. The competition started from a US endeavor to replace Russian rocket technology.
Tesla accepted some of the $600 billion that Treasury Secretary Steve Mnuchin offered corporations early in the pandemic. As Insider reported in July 2020, Tesla did so while Musk was tweeting against government aid for individuals.
"Another government stimulus package is not in the best interests of the people imo," Musk tweeted.
In Tesla's July 2020 regulatory filing, it mentioned that the company received "certain payroll related benefits," but did not specify any dollar amounts.
In 2016, New York state put $750 million towards Musk's planned solar-panel plant in Buffalo. About $350 million of those state funds was allocated for the construction of the facility, and $400 million was given for equipment. This was in exchange for the company's pledge to spend $5 billion on SolarCity, which promised the creation of 5,000 new jobs.
Musk's SolarCity reported in 2015 that it had received $497.5 million in direct grants from the US Treasury Department. The Los Angeles Times estimated SolarCity's total receipts to be higher — $1.5 billion — based on the price of a solar panel and the company's reported sales.
Additionally, the federal government provided tax credits that covered 30% of the cost of solar photovoltaic systems, such as the ones SolarCity installed, before 2020. That credit currently covers 26% of the cost of such systems for consumers.
Tesla has also collected more than $517 million from competing car manufacturers by selling them environmental credits, The Los Angeles Times estimated in 2015. In states like California, car manufacturers need to buy the credits if they don't sell the amount of zero-emissions cars required by mandates.
The federal government offers a $7,500 tax credit that car buyers can use to shave off some of the higher cost of purchasing an electric vehicle, which benefits Tesla as the industry's pioneer. This made buying the cars at Tesla's price points more feasible, before it hit the threshold of 200,000 cars sold.
The state of Nevada signed a package of bills in 2014 providing $1.3 billion in tax breaks and other incentives for Tesla. Nevada Governor Brian Sandoval wanted the electric car company to build a $5 billion lithium-ion battery factory in his state, called the "Gigafactory." The deal also included tax credits and other incentives for 20 years. Reuters estimated this aspect of the deal was worth $725 million.
Reuters also projected that the company would save more than $300 million in payroll taxes, among other taxes, through 2024.
Like many other wealthy Americans, Musk has spoken out against a proposed "billionaires' tax" from Sen. Ron Wyden, writing on Twitter in October that "eventually, they run out of other people's money, and then they come for you."
More recently, he spoke out against government subsidies and tax incentives for US businesses. In a recent interview with TIME, he said the government was not a good "steward of capital."
And at a Wall Street Journal summit this month, Musk said the government should "just delete" all subsidies from the $1 trillion infrastructure bill President Joe Biden recently signed into law. Biden's bill included $7.5 billion for electric vehicle charging infrastructure, which would seem to help one of Musk's companies, Tesla Motors.
However, over the years, Musk's companies — Tesla Motors, SpaceX, and SolarCity — have received billions of dollars from government loans, contracts, tax credits, and subsidies. According to a Los Angeles Times investigation, Musk's companies had received an estimated $4.9 billion in government support by 2015, and they've gotten more since.
Here's a look at some of the federal and state-level government subsidies that have contributed to building Musk's empire.
In April, NASA selected Musk's aerospace company SpaceX for a $2.89 billion contract to work toward landing "commercial" humans on the moon. Musk beat out Jeff Bezos's aerospace manufacturer Blue Origin for the contract, which gives NASA use of Musk's Starship spacecraft to take astronauts from lunar orbit to the moon. Musk's company has been developing the spacecraft with the intent of taking the first humans to Mars.
The US Air Force has joined in on the SpaceX action as well. In 2020, Musk's SpaceX and United Launch Alliance won two contracts for National Security Space "launch services" worth a combined $653 million, which they will provide between 2022 and 2027. The competition started from a US endeavor to replace Russian rocket technology.
Tesla accepted some of the $600 billion that Treasury Secretary Steve Mnuchin offered corporations early in the pandemic. As Insider reported in July 2020, Tesla did so while Musk was tweeting against government aid for individuals.
"Another government stimulus package is not in the best interests of the people imo," Musk tweeted.
In Tesla's July 2020 regulatory filing, it mentioned that the company received "certain payroll related benefits," but did not specify any dollar amounts.
In 2016, New York state put $750 million towards Musk's planned solar-panel plant in Buffalo. About $350 million of those state funds was allocated for the construction of the facility, and $400 million was given for equipment. This was in exchange for the company's pledge to spend $5 billion on SolarCity, which promised the creation of 5,000 new jobs.
Musk's SolarCity reported in 2015 that it had received $497.5 million in direct grants from the US Treasury Department. The Los Angeles Times estimated SolarCity's total receipts to be higher — $1.5 billion — based on the price of a solar panel and the company's reported sales.
Additionally, the federal government provided tax credits that covered 30% of the cost of solar photovoltaic systems, such as the ones SolarCity installed, before 2020. That credit currently covers 26% of the cost of such systems for consumers.
Tesla has also collected more than $517 million from competing car manufacturers by selling them environmental credits, The Los Angeles Times estimated in 2015. In states like California, car manufacturers need to buy the credits if they don't sell the amount of zero-emissions cars required by mandates.
The federal government offers a $7,500 tax credit that car buyers can use to shave off some of the higher cost of purchasing an electric vehicle, which benefits Tesla as the industry's pioneer. This made buying the cars at Tesla's price points more feasible, before it hit the threshold of 200,000 cars sold.
The state of Nevada signed a package of bills in 2014 providing $1.3 billion in tax breaks and other incentives for Tesla. Nevada Governor Brian Sandoval wanted the electric car company to build a $5 billion lithium-ion battery factory in his state, called the "Gigafactory." The deal also included tax credits and other incentives for 20 years. Reuters estimated this aspect of the deal was worth $725 million.
Reuters also projected that the company would save more than $300 million in payroll taxes, among other taxes, through 2024.
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Business Insider - Ace AU - 9/5 13:19:54