SpaceX Secures Subsidies, Skirts Significant Federal Taxes
Elon Musk’s rocket and satellite internet company SpaceX has secured billion-dollar contracts from the U.S. government over more than two decades. However, internal documents obtained by The New York Times indicate that the company has paid very little federal income tax since its inception—and may potentially never pay significant amounts in the future.
The report states that by the end of 2021, SpaceX had accumulated nearly $5 billion in losses, which can be offset against future taxable income. “Due to the Trump administration’s 2017 policy changes, there is no expiration date on this tax benefit,” the report notes. “This means the company could utilize approximately $3 billion of its losses indefinitely.”
Tax experts have pointed out that it is remarkable for a company so heavily reliant on government contracts to owe virtually no federal tax. In 2020, 84 percent of SpaceX’s revenue came from federal agreements.
Meanwhile, other major tech companies, such as Microsoft, paid $14.1 billion in federal taxes in the last fiscal year. “Despite posting $5 billion in effective profits in 2024, SpaceX continues to benefit from tax exemptions,” experts said.
Critics argue that tax incentives designed to support companies through difficult times are now being utilized by a company that has already achieved substantial commercial success.
