Democrats are facing hurdles to making a new annual tax on billionaires’ investment gains a reality.
The proposal, championed by Senate Finance Committee Chairman Ron Wyden (D-Ore.), is seen as a way to help pay for the party’s social spending package while accommodating Sen. Kyrsten Sinema’s (D-Ariz.) opposition to raising tax rates.
But some Democratic lawmakers have expressed reluctance to including a new tax proposal in the package, and tax experts say there could be challenges in crafting its details.
“To try to get this tax regime right at the last moment, without public input, is daunting,” said Steve Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center, whose former director now works in the Biden administration.
Taxing billionaires’ unrealized capital gains annually, a concept known as “mark-to-market,” is gaining steam as an alternative given Sinema’s objection to raising rates on corporations and high earners. Currently, people do not pay taxes on capital gains until investments are sold.
Democrats need all 50 senators in their caucus to agree to get a measure through the Senate, where the party is using special budget rules that avoid a filibuster.
The mark-to-market proposal is expected to apply to about 700 taxpayers with more than $1 billion in assets or $100 million in income for three years in a row. Eligible households would have to pay taxes annually on gains of tradable assets such as stocks. For non-tradable assets, billionaires would have to pay a charge when they sell the investments, on top of capital gains taxes.
Wyden has been working on a mark-to-market proposal since 2019. He told reporters late Monday that he hopes to complete a proposal in the next few days. Biden has also expressed support for the idea. Supporters say it would help to prevent the wealthiest Americans from avoiding taxes.
“It would help get at capital gains, which are an extraordinarily large part of the incomes of the wealthiest individuals,” Treasury Secretary Janet Yellen said Sunday on CNN.
One thought on “Billionaire tax gains momentum”
Only those with extreme mental deficiencies would support this kind of tax. Moving the wealth from the dog onto the Rick is extremely stoooopid. It also shows a reckless disregard for liberty and ignores the fact that the wealthy already pay the bulk of the taxes. Hellenic needs to go.