Vermont Sen. Bernie Sanders rolled out a wealth tax proposal that is even more aggressive than Massachusetts Sen. Elizabeth Warren’s plan on Tuesday.
Though Warren was the first to introduce a wealth tax proposal, Sanders’ plan would apply to more households and impose a higher tax rate.
The plan would cut the typical billionaire’s fortune in half within 15 years, according to Sanders. The revenues would be used to fund his housing plan, universal child care, and help pay for his “Medicare for All” proposal.
“Let me be very clear: As president of the United States, I will reduce the outrageous and grotesque and immoral level of income and wealth inequality,” Sanders told The New York Times. “What we are trying to do is demand and implement a policy which significantly reduces income and wealth inequality in America by telling the wealthiest families in this country they cannot have so much wealth.”
“I don’t think that billionaires should exist,” he said. “This proposal does not eliminate billionaires, but it eliminates a lot of the wealth that billionaires have, and I think that’s exactly what we should be doing.”
Wealth plan targets top 0.1%:
Sanders’ wealth tax would hit households with a net worth over $32 million, compared to Warren’s plan which kicks in at $50 million.
Sanders’ plan would apply to about 180,000 households, or about the top 0.1 percent. The plan would create a 1% tax with increasing marginal rates increasing up to 8% on net worth over $10 billion. Warren’s plan would apply to about 70,000 households and would impose a 2% tax on net worths up to $1 billion and 3% on those over $1 billion.
Sanders’ plan is projected to raise $4.35 trillion over 10 years, while Warren’s plan is projected to raise $2.6 trillion.
“Sanders included several steps in his plan to enforce the tax, including creating a ‘national wealth registry,’ increasing funding for the Internal Revenue Service and requiring audits of many taxpayers who are subject to the wealth tax, including all billionaires,” The Times reported.
Sanders, Warren consulted same economists:
The estimates were produced by Berkeley professors Emmanuel Saez and Gabriel Zucman, who advised both Sanders and Warren on their plans.
“The Sanders plan is really pitched at the idea that we don’t want billionaires and decabillionaires to be billionaires and decabillionaires for as long as they currently are,” Saez told The Times. “It’s going to erode their fortunes much faster than the Warren wealth tax.”
“Mr. Saez and Mr. Zucman calculated how the Warren and Sanders wealth taxes would have affected the fortunes of the richest Americans had each been in effect since 1982. The fortune of Jeff Bezos, the Amazon founder who Forbes said was worth $160 billion last year, would have been $87 billion under the Warren plan and $43 billion under the Sanders plan,” The Times reported. “Over all, the economists found, the cumulative wealth of the top 15 richest Americans in 2018 — amounting to $943 billion — would have been $434 billion under the Warren plan and $196 billion under the Sanders plan.”