The project would seek to raise US $ 3 trillion to rebuild the economy and combat inequality, imposing an annual tax of 2% on the net worth of families and trust funds between US $ 50 million and US $ 1 billion. Billionaires would face a 3% tax.
“We designed this wealth tax based on the experiences of other countries that created a wealth tax and were not always successful,” Warren said in the interview. “We saw where the errors were and made sure we corrected them.”
$ 100 billion to the IRS to combat tax fraud
Critics argue that taxing wealth would be a challenge, if not unconstitutional. In particular, there are concerns about how to value assets and prevent the wealthy from hiding money abroad
“People say, ‘Well, the rich cheat, so we shouldn’t even try to use a wealth tax,'” said Warren. “But if the rich cheat, it doesn’t mean that we should just give up and let them pay taxes at lower rates than everyone else. It means that we need to hire more inspections and get them to follow the rules.”
Warren’s fortune tax comes with teeth.
The legislation has an internal audit rate of 30%, which means that nearly a third of all families would be audited each year. And the project envisages increasing the IRS budget by $ 100 billion to increase the audit agency’s firepower and modernize IT systems.
The Warren plan also proposes a 40% “exit fee” on net worth over $ 50 million for any American citizen who resigns his or her citizen to avoid paying the tax.
“After setting the fortune tax, it is not very difficult to monitor it year by year. If last year you owned a property, this year it is better to own the same property or have a lot of money that raised a sale,” said Warren .
Justice in the tax system
Asked whether President Joe Biden has an appetite for a fortune tax, White House press secretary Jen Psaki said during Monday’s press conference that Biden “strongly believes that the ultra-rich and the poor corporations must finally start paying their fair share “.
“He came up with a lot of ideas and when we get to that point on our agenda, he will be looking forward to working with [Warren] and others in Congress, “said Psaki.
In other words, the White House has not ruled this out.
Last year, the poorest 99% of households paid about 7.2% of their total wealth in taxes, according to Warren. The tenth of the top 1%, however, paid only 3.2% of its wealth in taxes.
Warren said there was bipartisan support among voters for a wealth tax, including a majority of independents and Republicans.
“They understand how unfair the current system is,” she said.
The $ 15 minimum wage fight
“I would be happy to see us approve the minimum wage through reconciliation,” said Warren, referring to the budget process that requires only a simple majority to pass. “And I will fight for it.”
Asked about Manchin and other moderates who oppose popular measures like the $ 15 minimum wage, Warren focused on where Democrats agree.
“Democrats want us to raise the minimum wage,” she said. “We need to talk more about exactly what the level is and how to do it. But we want the minimum wage to go up.”