No Mercy / No Malice: The Epstein Tax

February 28, 2026

16 min episode · 2 min read

Episode

16 min

Read time

2 min

AI-Generated Summary

Published Feb 28, 2026

Key Takeaways

✓Buy-Borrow-Die Loophole: Billionaires borrow against appreciating assets instead of selling, deferring taxes indefinitely. In 2011, Jeff Bezos — worth $18B — reported so little income he claimed a $4,000 child tax credit. Americans holding $100M+ had $8.5T in unrealized gains by 2022.
✓Carried Interest Reform: Private equity and venture capital managers pay a 20% capital gains rate instead of the 37% ordinary income rate on carried interest. Closing this loophole raises roughly $15B over ten years — modest but a concrete, politically viable starting point.
✓Borrowing as Taxable Event: When wealthy individuals pledge assets as loan collateral, taxing the appreciation between original purchase price and pledge date could generate over $100B per decade, targeting the buy-borrow-die strategy without requiring a constitutionally risky broad wealth tax.
✓IRS Enforcement Gap: The tax gap — taxes owed but uncollected — reached $700B in 2022, driven largely by wealthy taxpayer underreporting. Biden's $80B IRS funding increase, since reversed, was projected to net $600B over a decade; the agency has since lost over 25% of its workforce.

What It Covers

Scott Galloway examines how U.S. wealth inequality has reached pre-French Revolution Gini coefficient levels above 0.8, why wealth taxes historically fail, and which three specific tax reforms could raise hundreds of billions annually.

Key Questions Answered

•Buy-Borrow-Die Loophole: Billionaires borrow against appreciating assets instead of selling, deferring taxes indefinitely. In 2011, Jeff Bezos — worth $18B — reported so little income he claimed a $4,000 child tax credit. Americans holding $100M+ had $8.5T in unrealized gains by 2022.
•Carried Interest Reform: Private equity and venture capital managers pay a 20% capital gains rate instead of the 37% ordinary income rate on carried interest. Closing this loophole raises roughly $15B over ten years — modest but a concrete, politically viable starting point.
•Borrowing as Taxable Event: When wealthy individuals pledge assets as loan collateral, taxing the appreciation between original purchase price and pledge date could generate over $100B per decade, targeting the buy-borrow-die strategy without requiring a constitutionally risky broad wealth tax.
•IRS Enforcement Gap: The tax gap — taxes owed but uncollected — reached $700B in 2022, driven largely by wealthy taxpayer underreporting. Biden's $80B IRS funding increase, since reversed, was projected to net $600B over a decade; the agency has since lost over 25% of its workforce.

Notable Moment

Galloway proposes reviving an expanded Alternative Minimum Tax — 40% for incomes above $1M and 60% above $10M — estimating it could raise hundreds of billions annually while affecting only roughly 275,000 taxpayers, the top 0.2%.

Know someone who'd find this useful?