This story originally appeared in Common Dreams on March 27, 2022. It is shared here with permission under a Creative Commons (CC BY-NC-ND 3.0) license.
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Economic experts and progressives opposed to the outrageous levels of inequality in the United States celebrated Saturday evening and into Sunday after reporting revealed that President Joe Biden plans to unveil “a 20 percent minimum tax rate on all American households worth more than $100 million”—a so-called “Billionaire’s Tax” that will specifically target approximately 700 of the nation’s wealthiest people.
First reported by the Washington Post‘s Jeff Stein, citing multiple people familiar with the matter and an internal White House document, the proposal could be announced as early as Monday, part of the president’s rollout of his 2023 budget.
According to the Post:
Gabriel Zucman, associated professor of economics at UC Berkeley and an expert on inequality and taxation, said the Biden plan could have real teeth.
“This is big!” Zucman tweeted late Saturday in response to the reporting on the plan. “With this tax, the top 10 billionaires alone would pay at least $215 billion in the next 10 years.”
Currently, the five richest US billionaires are Elon Musk of Tesla, Amazon founder Jeff Bezos, Microsoft’s Bill Gates, Berkshire Hathaway’s Warren Buffett, and Google co-founder Larry Page.
“How big of a change would this make?” Zucman continued. “According to ProPublica, Bezos, Buffett, and Musk collectively paid $1.5 billion in federal income tax in the 5 years 2014-2018.” But under the Biden proposal, he said, “they would pay at least $111 billion (almost 100x more) over the next 9 years.” The increase would be especially profound, given how little these ultra-wealthy individuals currently pay.
The White House document on the proposal, according to the Post, states: “The Billionaire Minimum Income Tax will ensure that the very wealthiest Americans pay a tax rate of at least 20 percent on their full income. This minimum tax would make sure that the wealthiest Americans no longer pay a tax rate lower than teachers and firefighters.”
Harvard economics professor Jason Furman called the plan a “landmark proposal” from Biden. “A minimum tax that also applies to unrealized gains—as a prepayment against future capital gains,” he said, would be a substantive improvement for the nation’s tax system, one that “should get serious consideration as a fair and efficient way to raise significant revenue.”
The nonpartisan Institute on Taxation and Economic Policy, which has documented the various ways by which current tax code favors the rich over working people, said the proposal—which comes at a time in which “billionaire wealth grew by $1.7 trillion during the pandemic“—would be a great improvement over the status quo.
Americans For Tax Fairness, a campaign coalition of more than 400 national and local organizations that advocates for a more fair tax system, also welcomed the news.
“Right now in America,” the group said Saturday, “704 billionaires own more wealth than 65 million households. We can build an economy that works for the rest of us, but we need billionaires to pay their fair share. It’s time for a #BillionairesTax.”
