How is it infinite? Oil forms from ancient organic matter under intense heat and pressure, a process taking millions of years, making it non-renewable on human timescales.
It can be synthesized from air and water with energy and the right catalysts, although the process isn’t cheap. However if solar power keeps getting cheaper it might become feasible to produce it this way instead of drilling.
Despite spending a mind-numbing amount of time deeply embedded in the automotive world, I had no idea synthetic oil didn’t have oil or petroleum precursors.
This is an incredible, and wildly under discussed win.
As soon as solar energy is being used at scale, this will probably become way more commonly used - big electricity expense is the only main cost.
The problem is that solar only works when the sun is out and startup/shutdown on industrial chemical processes isn’t easy. Once you start involving batteries for around-the-clock operation, it’s more efficient just to use electricity directly. Synthetic hydrocarbons are best used for the cases like aviation where the energy density is the biggest hurdle.
Ultra-wealthy individuals legally minimise their tax liability by:
Receiving a relatively low official salary (Bezos's Amazon salary was $81,840 for many years).
Not receiving dividends, so the wealth remains in stock that is not taxed annually.
Borrowing money against their stock holdings to fund their lifestyle. Loans are not considered income and are therefore not taxable, and the interest on the loans can sometimes be used as a deduction.
> Borrowing money against their stock holdings to fund their lifestyle. Loans are not considered income and are therefore not taxable, and the interest on the loans can sometimes be used as a deduction.
A loan should definitely be a taxable event and capital gains taxes should apply to rebase the value of the stock to the market value at the time the loan is taken out. Currently, very wealthy people use the loan dodge to avoid selling stocks and since the loan isn't paid off until death (usually), estate taxes wave their hands and any gains in the stock price go away, so that the next nepo generation gets to repeat the same dodge.
Rather, you pay taxes on the income you use to repay the loan. Plus you pay the interest on the loan.
This basically defers the taxes to a later date and charges you interest for 'em. Which might be worthwhile, depending on how quickly and reliably your capital is growing.
I think the claimed issue is that these people do receive income from those assets indirectly. My understanding is that if your assets are worth much more than the amount you're borrowing then a bank is happy to keep giving you loans, which you use like income, that incur compound interest until you die, your estate must settle up the loans, and the estate gets to pay capital gains against the basis when you died, not the basis when the shares were first created and worth $1 each.
There is no tax loophole. The only thing they are getting is higher leverage against borrowing, and the only difference would occur if that individual would go bankrupt in that the entity that they borrowed from wouldn't need to pay income tax.
So the only way to pay less tax is to surrender all your assets.
I'm not sure if "options" is the relevant word in your post, but it does seem like capital gains tax is significantly reduced in inheritances? Here's an example source that says the cost basis gets reset to its value at approximately the deceased's death [1], and gains relative to that cost basis are likely much smaller (and thus a much smaller tax burden) than those relative to their initial acquisition price possibly decades earlier, no?
Even according to you article, fair market value at the time of transfer is subject to same tax. Can you phrase what exactly you are trying to say?
I included options because that's how ultra wealthy get their wealth from and it has market value of 0 so company could give lot of them.
Also anyone can get majority of your earning in stocks, not just ultra rich. Companies want to pay in stocks, and it's a win win for both, if there is a loophole.
My understanding is that it's not subject to the same tax it would have been as income, since the federal estate tax only applies to value above ~14 million per individual. So, my understanding is that a married couple can pass 25 million in stocks to their heirs and pay nearly no taxes on it because it's under the estate tax threshold and the capital gains cost basis got reset on their death. But not everyone can do this because you need enough assets or other business the bank wants to handle for them to be happy lending you money for years, and only people with a lot of assets have either of those things.
(I'm happy to be wrong about this, since it seems unfair, but AFAIK this is how it works?)
I heard from a medium reliable source that this loophole wasn't as popular as the zeitgeist implies. I'd love to know how true that is and if so, how the rich finance themselves.
In a real-world scenario, if you saw a result significantly far from 100 (like 150 heads), you might suspect the coin is unfair. However, seeing exactly 100 heads gives no reason to suspect the coin is unfair; it's the result most consistent with a fair coin.
Despite its overall failure, some parts of the infrastructure and national applications, such as the Summary Care Record and the Electronic Prescriptions Service, are considered to have survived and continue to be used
In that case they were not buried alive rather they were just in isolation. We do that to prisoners all the time all around the world often in much worse conditions including being chewed on by diseased rats and worse.
The privatisation of the water industry in the UK certainly wasn’t and is considered a failure due to rising bills, poor infrastructure, and severe pollution from sewage overflows.
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