Erik McGregor | LightRocket | Getty Images

As Democrats move forward with a lopsided reconciliation package, House lawmakers are pushing another part of President Joe Biden’s agenda: taxes on the wealthy.

The Rep. Don Beyer, D-Va., and Steve Cohen, D-Tenn., introduced the Billionaire Minimum Tax Act, requiring a 20% tax on households worth more than $100 million, affecting about 0.01% of American families, congressional documents outlined.

The 20% tax applies to “total income”, including income and so-called unaccounted profits, or capital gains, with a credit to avoid double taxation and the optional payment plan, according to the bill, which was introduced with 30 partners. sponsor.

More from Personal Finance:
What the Fed’s 75-basis rate hike means for you
Here’s what advisors are telling their clients as recession fears mount
Democrats want to strengthen Social Security. What does this mean for benefits

“While working families pay taxes on every paycheck or pension payment, the wealthy can earn hundreds of millions of tax-free dollars every year,” Cohen said in a statement.

“Instead of billionaires buying superyachts, rocket ships, professional sports teams, and Twitter, it’s time for billionaires to at least pay taxes like everyone else,” he said.

The wealthiest 400 families paid a federal income tax of 8.2% from 2010 to 2018, according to the White House. This compares to 13.03% for the average American.

The minimum tax on Biden's billions is about politics, says Marcus Evercore's Tobin

Overall, more Americans favor higher taxes on the super-rich, according to a March 2022 YouGov PLC survey, and nearly two-thirds support a tax of at least 20% of income. more than $100 million in debt.

The billionaire tax has struggled to gain traction

It could take years for this thing to be ready for prime time.

Garrett Watson

Senior policy analyst at the Tax Foundation

However, the latest billionaire tax proposal could be part of a “broader effort to experiment” to see what type of tax might garner enough support, he said.

Some tax legislation has a “very long lead time,” with proposals being discussed for five to 10 years before negotiations are reached, Watson said, pointing to the 2017 tax reform by the Republicans.

“This thing could take years to be ready the first time,” he added.

Source link