Elizabeth Warren unveils plans for a wealth tax on all Americans with net worths higher than $50 million as Democrats get ready for when they’ve passed $1.9tn stimulus plan
- Warren touted the tax on ‘ultra millionaires’ during her presidential campaign
- It would put 2 per cent annual tax on those worth $50 million up to $1 billion
- Additional 1 per cent surtax on assets over $1 billion
- There are major administrative challenges to taxes on wealth rather than income
- The House passed Biden’s $1.9 trillion COVID response plan early Saturday
- That plan does not have spending offsets
Sen. Elizabeth Warren rolled out her plan Monday to slap a 2 per cent annual wealth tax on people whose net worth is over 50 million and up to $1 billion – setting the stage for debates over how to pay for Joe Biden‘s infrastructure and environmental proposals.
Warren’s plan is similar to what she advocated in her 2020 presidential campaign, where she lost to Biden, who did not come out for a wealth tax.
Sen. Elizabeth Warren (D-Mass.) is rolling out her plan to slap a 2 per cent tax on the wealth of people whose net worth is between $50 million and $1 billion
In addition to the 2 per cent tax on individuals and trusts worth up to $1 billion, it would impose an additional 1 per cent surtax on assets over $1 billion, hitting billionaires with a 3 per cent tax.
‘A #WealthTax is critical for raising revenue, and that revenue is critical for raising opportunity. We build a future for all of our kids by investing in opportunity. This is one way we can make this government work for everyone—not just the rich and powerful,’ she tweeted.
She called it a ‘a few cents more for billionaires’ on the dollar, and linked it to Biden’s ‘build back better’ economic plan.
‘This is money that should be invested in child care and early education, K-12, infrastructure, all of which are priorities of President Biden and Democrats in Congress,’ she said in a statement.
Vermont Sen. Bernie Sanders (I-Vt.), a former presidential rival of Warren’s, backs the plan
Warren introduced the plan along with Reps. Pramila Jaypal of Washington and Brendan Boyle of Pennsylvania
Warren linked the proposal to President Joe Biden’s ‘build back better’ plan
‘As Congress develops additional plans to help our economy, the wealth tax should be at the top of the list to help pay for these plans because of the huge amounts of revenue it would generate,’ she said.
The move sets the stage for fierce tax fights once Congress dispenses with Biden’s $1.9 trillion COVID relief package. That package is meant to stimulate the economy by providing $1,400 checks to Americans and extending federal unemployment benefits.
The package, like prior relief bills, is funded on an ’emergency’ basis without revenue raisers to pay for it.
But Biden has sketched out many other plans to boost education, infrastructure, and spending on environmental programs that will need a source of funding.
Warren’s plan would raise $3 trillion over a decade, she said, citing analysis by two Berkeley economists, Emmanuel Saez and Gabriel Zucman. They wrote that it would raise more now in part due to inequities exacerbated by the pandemic, according to a New York Times article that Warren linked to in her tweet.
‘Wealth at the top, particularly among billionaires, has grown in the two years’ they write.
Warren’s plan would have to clear a 60-vote hurdle in the Senate – a chamber where it appears Democrats do not even have 50 votes for a $15 minimum wage bill that the parliamentarian announced would be stripped out of the coronavirus package.
There are major administrative challenges to taxing accumulated wealth, as opposed to income, and the bill were it enacted would face court challenges.