If millionaires and billionaires are squirming at the prospect of Sen. Elizabeth Warren’s wealth tax, wait until they get a look at what Sen. Bernie Sanders has in store for them.
Warren has made a two-cent tax on every dollar earned over $50 million a signature campaign promise — so much so that two of her aides dressed up as a pair of pennies at the Polk County Steak Fry in Des Moines over the weekend.
Not to be outdone, Sanders’ presidential campaign released a wealth tax proposal Tuesday morning that goes even further than Warren’s. It may not be as easy to create a costume or catchphrase around, but it is pretty easy to understand.
Sanders’ plan includes the same 2 percent tax on every dollar earned over $50 million. But it would also include a lower wealth tax bracket as well, instituting a one-cent tax on every dollar earned over $32 million.
Warren’s plan would increase the levy only once, at the $1 billion income threshold, with a 3 percent tax on every dollar beyond that. But Sanders would institute a progressive tax structure: 3 percent from $250 to $500 million, 4 percent from $500 million to $1 billion, 5 percent from $1 to $2.5 billion, 6 percent from $2.5 to $5 billion, 7 percent from $5 to $10 billion, and 8 percent on wealth over $10 billion.
“This country is moving into an oligarchic form of a society,” Sanders told the crowd at a campaign stop in Clinton, Iowa, Monday night, before the plan was released. “Although I suspect there are not too many billionaires in this room, what we are saying to the billionaire class is, ‘Stop the greed. Stop the corruption. Stop stepping on everyone in order to make more billionaires.’”
For voters or pundits hoping for a showdown between Warren and Sanders to clarify who is the true progressive candidate, this may be as exciting as it gets. The two candidates have refused to take any shots at each other.
On this issue, however, Sanders has taken a policy that has defined Warren’s campaign and built on it — a signal to the Democratic base that when it comes to policy, he is willing to go further than she is, even if he won’t say it outright.
Sanders also enlisted the two economists who helped design Warren’s plan to review his. Berkeley University economics professors Emmanuel Saez and Gabriel Zucman wrote in a letter that a progressive wealth tax is the most direct tool to curb runaway wealth concentration.
“Senator Sanders' very progressive wealth tax on the top 0.1 percent wealthiest Americans is a crucial step in this direction. We estimate that Sanders’ wealth tax would raise $4.35 trillion over a decade and fully eliminate the gap between wealth growth for billionaires and wealth growth for the middle class,” they wrote.
The economists estimate that the proposal would tax roughly 180,000 U.S. households.
In case anyone tries to evade the tax, Sanders includes harsh enforcement provisions in his plan. He would require a national wealth registry and increase funding to the IRS to audit all billionaires yearly in addition to 30 percent of the returns that qualify for the wealth tax. The plan would also institute hefty exit taxes on those trying to move money to offshore accounts.
Cover: Democratic presidential candidate U.S. Sen. Bernie Sanders, I-Vt., speaks during a brief campaign stop at Town Clock Plaza in Dubuque, Iowa on Monday. (Nicki Kohl/Telegraph Herald via AP)