Articles

Congressional Democrats propose 'Millionaires Surtax'

BY NIHAL KRISHAN - 11/07/2019

Congressional Democrats released a proposal on Thursday to generate an estimated $635 billion in federal revenue over a decade by levying a 10-percentage point tax on incomes above $2 million for married couples or above $1 million for individuals.

The “Millionaires Surtax,” introduced by Sen. Chris Van Hollen and Rep. Don Beyer, would only apply to the richest 0.2% of Americans, and the revenue would likely be used to make new investments in education, healthcare, and infrastructure.

Van Hollen said in a statement that the new legislation is supposed to "put in place a simple system to ensure the wealthy are doing their part to invest in strengthening America’s future for everyone."

The tax would apply to all forms of income over $2 million, both wages and salaries and capital gains. Currently, following the Trump tax cuts, labor is taxed at a top rate of 37%, and long-term capital gains are taxed at a top rate of 23.8%.

The proposal comes at a time when wealth tax proposals are gathering steam within the Democratic Party. Presidential candidates Bernie Sanders and Elizabeth Warren have introduced plans for aggressive new wealth taxes on the rich. Warren's plan would tax those with above $50 million in wealth, and Sanders's plan would hit those with over $32 million.

The Millionaires Surtax, which would tax forms of income rather than wealth, would set the threshold for the added tax to just $2 million.

The Democrats cited new polling, which shows that 73% of Americans support the proposal, including 57% of Trump voters.