Sen. Elizabeth Warren introduces wealth tax bill aimed at people worth over $50 million

Senator elizabeth warren
Sen. Elizabeth Warren. GREG NASH/POOL/AFP via Getty Images
  • Sen. Elizabeth Warren introduced a bill on Monday that would tax the wealthiest people in the US.
  • The bill would apply a 2% tax on individuals with net worths between $US50 ($65) million and $US1 ($1) billion.
  • The Biden administration has not expressed support for the idea.
  • Visit the Business section of Insider for more stories.

Sen. Elizabeth Warren of Massachusetts on Monday unveiled legislation that would tax the fortunes of the wealthiest people in the United States.

The bill, called the Ultra-Millionaire Tax Act, would apply an annual 2% tax on individuals with net worths between $US50 ($65) billion and $US1 ($1) billion. Individuals worth over $US1 ($1) billion would pay an annual 3% tax. A University of California Berkeley analysis, cited by Warren, estimates that the tax would generate $US3 ($4) trillion in revenue over 10 years. Warren proposed that the new federal money would be invested in programs such as child care, education and infrastructure.

The progressive Democrat said the tax aims to “level the playing field and narrow the racial wealth gap” in the country, according to a statement on Monday. 

Warren regularly floated the idea of a “wealth tax”  during her 2020 presidential run. She has renewed those calls in recent months as the coronavirus pandemic has disproportionately affected communities of color and cast a light on the major economic disparities in the country. 

“As working families struggle to put food on the table, keep the heat on, and pay the rent during this devastating economic crisis that has caused the poverty rate to jump by the largest amount in at least 60 years, the rich have only gotten richer and the wealth of billionaires has jumped by 40%,” Democratic Rep. Pramila Jayapal of Washington, who introduced the bill with Warren, said in a statement.

The bill is cosponsored by Independent Sen. Bernie Sanders of Vermont, and Democratic Sens. Sheldon Whitehouse of Rhode Island, Jeff Merkley of Oregon, Kirsten Gillibrand of New York, Brian Schatz of Hawaii, Ed Markey of Massachusetts, and Mazie Hirono of Hawaii. 

President Joe Biden’s administration has not endorsed the plan. Treasury Secretary Janet Yellen told the New York Times last week that “it’s something that has very difficult implementation problems.”

Biden has been focused on providing immediate relief to the American people amid the public health crisis through his $US1 ($1).9 trillion stimulus package. The House passed the legislation, which would include $US1 ($1),400 in direct payments, on Saturday. Senate Democrats plan to take up the bill this week.