They own more wealth than the bottom 80 percent combined. Yet these multi-millionaires and billionaires have seen their taxes decline over the decades, in part because the tax code favors wealth over work.
This richest 0.1 percent receives two-thirds of their income from investments, while most working families have little capital income and depend on wages. But our rigged system taxes most investment income from wealth at a top rate of about 24 percent — considerably lower than the top 37 percent rate for work.
One way to ensure that the wealthy pay first is to institute a 10 percent surtax on incomes over $2 million. This “multi-millionaire surtax” would raise nearly $600 billion in revenue over 10 years, according to an upcoming study from the Tax Policy Center.
The surtax would apply to income earned from work (wages and salaries) and to investment income gained from wealth, including capital gains and dividends. So those with capital income over $2 million would not get a preferential tax rate.
The multi-millionaire surtax is easy to understand, simple to apply, and effective — because it covers all kinds of income, making it difficult for the wealthy to avoid.
And it is laser focused on the super-rich. Anyone earning below $2 million a year will not pay a dime.
As a nation, we will need to raise trillions to protect Social Security, Medicare, and Medicaid, and to address urgent priorities such as health care, climate change, child care, higher education, opioid addiction, and more.
The middle class should have 100 percent confidence that they won’t be asked to pony up until Wall Street speculators and billionaires pay the piper. A multi-millionaire surtax is a good first step.
Distributed by OtherWords.