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Senate Democrats introduce proposal for 3% tax on billionaires

Senate Democrats introduce proposal for 3% tax on billionaires
Sen. Elizabeth Warren and other Democrats introduced the "Ultra-Millionaire Tax Act" which would implement a 3% tax on wealth exceeding $1 billion. Pool Photo by Greg Nash/UPI | License Photo

March 1 (UPI) -- Democratic lawmakers led by Sen. Elizabeth Warren introduced a proposal Monday to implement a 3% tax on wealth greater than $1 billion.

The "Ultra-Millionaire Tax Act" would implement a 2% annual tax on the net worth of households and trusts ranging from $50 million to $1 billion and an additional 1% annual surtax -- for an overall tax of 3% -- for those exceeding $1 billion.

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"The ultra-rich and powerful have rigged the rules in their favor so much that the top 0.1% pay a lower effective tax rate than the bottom 99% and billionaire wealth is 40% higher than before the COVID crisis began," Warren, D-Mass., said.

An analysis by economists at the University of California, Berkeley found that about 100,000 Americans or fewer than 1 in 1,000 families would be subject to the wealth tax in 2023 and that it would raise about $3 trillion over between 2023 and 2032.

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"Wealth at the top has boomed during the COVID crisis. Billionaires wealth has literally exploded while many Americans struggle with job and income loss," University of California-Berkeley economists Emmanuel Saez and Gabriel Zucman said. "The ultra-millionaire wealth tax is the most direct and powerful tool to curb growing wealth concentration in the U.S. and make sure the ultra-wealthy pay their fair share in taxes."

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The bill would also invest $100 billion to rebuild and strengthen IRS systems and personnel, ensure a 30% audit rate for the super wealthy and impose a 40% exit tax on Americans who attempt to renounce their citizenship to avoid a wealth tax.

In addition to Warren, the bill is co-sponsored by Sens. Bernie Sanders, I-Vt.; Sheldon Whitehouse, D-R.I.; Jeff Merkley, D-Ore.; Kristen Gillibrand, D-N.Y.; Brian Schatz, D-Hawaii; Edward Markey, D-Mass. and Maize Hirono, D-Hawaii.

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