Bernie Sanders on Tuesday unveiled a proposal for a wealth tax that would kick in on assets above $32 million and aims to cut in half the fortunes of billionaires over 15 years.
Sanders’ “Extreme Wealth Tax” targets the top 0.1% of U.S. households and would raise an estimated $4.35 trillion over the next decade. The revenue would be used to pay for his signature plans, including Medicare for All, universal child care and housing programs.
A 1% tax for households with a net worth of more than $32 million for a married couple would increase to 2% for households worth $50 million to $250 million, 3% from $250 million to $500 million, 4% on $500 million to $1 billion. The tax would cap at 8% on wealth above $10 billion.
Sanders’ presidential campaign said the cumulative effect of the tax over 15 years would be to cut in half the wealth of billionaires, “which would substantially break up the concentration of wealth and power of this small privileged class.”
“Enough is enough,” Sanders, a Vermont senator, said in a statement. “We are going to take on the billionaire class, substantially reduce wealth inequality in America and stop our democracy from turning into a corrupt oligarchy.”
To ensure the wealthiest Americans don’t evade the tax, the plans calls for the creation of a “national wealth registry” and “significant additional third-party reporting requirements.”
The U.S. Internal Revenue Service would be required to perform audits of 30% of wealth tax returns for those in the 1% bracket and all billionaires’ wealth tax returns would be audited.
For those who seek to leave the country to avoid the wealth tax, Sanders calls for a 40% exit levy on the net value of all assets of less than $1 billion and of 60% on assets greater than $1 billion.
The plan would treat assets in a trust “as owned by the grantor of the trust (by the person giving assets to the trust) until that person’s death.”
In January, before he announced his presidential run, Sanders proposed expanding the estate tax, calling for a rate of 45% tax on the value of estates between $3.5 million and $10 million. That rate would increase gradually to 77% for amounts more than $1 billion.