Uncomfy Joe Manchin Complains About Billionaire Tax Plan
The Billionaires Income Tax would tax America’s billionaires, including Jeff Bezos, Mark Zuckerberg, and Elon Musk. But can it pass through the gridlocked Senate?
Senate Democrats proposed the Billionaires Income Tax, which would tax 700 of America’s billionaires including people like Jeff Bezos, Mark Zuckerberg, and Elon Musk. The taxed income will be used to fund Biden’s economic agenda. The plan was authored by Sen. Ron Wyden of Oregon, chair of the Senate Finance Committee. And the plan would apply to taxpayers earning above $100 million in annual income or those holding at least $1 billion in assets for three years... the richest Americans could also take deductions if they suffer heavy losses.”
“Gabriel Zucman, a left-leaning economist at the University of California Berkeley, projects that Musk would owe up to $50 billion in taxes during the first five-year stretch of the plan. Bezos would pay up to $44 billion in the same period, per Zucman's projection.”
But will this tax plan succeed? First, it is important to consider the opposition it will face, and already is facing. Centrist Democrats like Joe Manchin are already pushing back: “Asked by CNN if he supports a proposed billionaire tax, Manchin sounded skeptical. "I don't like it. I don't like the connotation that we're targeting different people. There's people that basically contribute to society, that create a lot of jobs, and invest a lot of money, and give a lot to philanthropic pursuits," he said.”
This response from Manchin is unsurprising, given his voting record. Further, “Targeting” is necessary for a progressive tax system to function. And even if someone does create jobs, they can still exploit the workers while employed, given America’s weak labor laws.
Further, billionaires currently pay lower effective tax rates than average American workers. This is due to how assets are taxed preferentially. “Billionaires often pay much lower taxes compared to everyone else because they accumulate wealth from the climbing value of their stock and company holdings. Those aren't subject to capital-gains taxes until they are sold, known then as a realized gain. Once sold it's taxed at a lower, preferential rate compared to workers' income.”
There has also been pushback from people like Elon Musk, who would be affected the most by the tax plan. Musk, whose fortune grew by $119 billion since the start of 2021, has complained about the plan: “Eventually, they run out of other people's money and then they come for you.”
Other Democratic Senators like Mark Warner from Virginia also says he’s “anxious to look at” the tax plan. Moreover, all Republicans would likely vote against such a tax proposal.
Though more progressive Democrats like Sen. Elizabeth Warren have expressed approval for the tax plan, it does not seem likely to succeed in passing through the gridlocked Senate.