Activists spell out #TaxTheRich at Grand Central Station in New York City on March 4, 2021. (Photo: Erik McGregor/LightRocket via Getty Images)

Activists spell out #TaxTheRich at Grand Central Station in New York City on March 4, 2021. (Photo: Erik McGregor/LightRocket via Getty Images)

250 Millionaires to Congress: 'Now Is the Time' to Tax Billionaires

"A Billionaires Income Tax is not only an overdue tax reform, but also... smart politics."

As congressional Democrats continue to revise a pared-back version of the Build Back Better Act, a group of roughly 250 millionaires on Monday urged party leaders to include an "overwhelmingly popular" proposal to tax billionaires' annual investment gains in the final package, after it was excluded from the framework President Joe Biden unveiled last week.

"Unless Congress acts now, billionaires will continue to be allowed by Congress to pay far less than their fair share of taxes."

Biden's 10-year, $1.75 trillion Build Back Better framework "is a momentous investment in working families, and it achieves important tax reforms that will create a much fairer system," the millionaires wrote in a letter to House Speaker Nancy Pelosi (D-Calif.), Senate Majority Leader Chuck Schumer (D-N.Y.), House Ways and Means Committee Chair Richard Neal (D-Mass.), and Senate Finance Committee Chair Ron Wyden (D-Ore.).

"However, unless Congress acts now, billionaires will continue to be allowed by Congress to pay far less than their fair share of taxes," says the letter, which was organized by Americans for Tax Fairness, the Patriotic Millionaires, and Responsible Wealth. "Some will still be allowed to pay zero in income taxes despite enjoying soaring investment gains."

"A Billionaires Income Tax (BIT) is not only an overdue tax reform, but also... smart politics," the millionaires wrote. Wyden's proposal "enjoys the support of supermajorities across the country" and increases the popularity of the Democratic Party's agenda to invest in expanded public benefits and climate action "by up to 40 points in key states and competitive districts, especially among undecided independent voters," they added, citing recent surveys.

According to the signatories, the BIT "would raise $250 billion by... annually taxing the biggest source of billionaire income that now goes largely untaxed: investment gains."

The millionaires explained of billionaires:

The main source of income for most billionaires is the rise in the value of their assets. Often billionaires hold the majority of their wealth in stock of very profitable multi-billion-dollar corporations and derive their primary source of income from their rising stock value. Those investment gains are not taxed unless the underlying assets are sold, which billionaires don't need to do because they can live off low-cost loans secured by those rising asset values. And when their fortunes are passed along to their children, a lifetime of investment gains simply disappears for income tax purposes. It's because of these faults in the current tax system that billionaires like Jeff Bezos, Elon Musk, and Michael Bloomberg can, according to a ProPublica report based on IRS data, not pay any federal income taxes some years.

We support tax reforms that ensure high-wealth individuals like us pay our fair share, such as those included in the Build Back Better framework: a new surtax on millionaires and closing two major loopholes that owners of pass-through businesses use to significantly reduce contributions to the common good. We support these reforms because the country needs more revenue to make vital improvements in healthcare, education, child care, housing, climate response, and more. However, even with these important reforms, many billionaires can still pay little or nothing in taxes.

"It is neither fair nor smart to limit or exempt" from taxation the unrealized stock gains that constitute "the bulk of billionaires' growth in income," the millionaires added. "The BIT would tax billionaires' investment gains even if the underlying assets are not sold. [The] tax would be due annually on easily priced assets like stocks and bonds. Harder-to-price assets like real estate and collectibles would be taxed when sold, with interest added for the missed annual tax payments."

As Common Dreams has reported, the combined net worth of the nation's 745 billionaires has skyrocketed by more than $2.1 trillion over the past year and a half, as millions have been devastated by the Covid-19 pandemic and its economic repercussions.

Taxing billionaires' unrealized stock gains emerged as a potential revenue-raiser after right-wing Democratic Sen. Kyrsten Sinema (Ariz.)--swimming in campaign cash from Wall Street--single-handedly blew up her party's long-standing plan to hike taxes on corporations and wealthy individuals.

Related Content

Activists march with a

Megarich Democratic Donor Says 'Tax Rich People Like Me' or He's Done With the Party

Andrea Germanos

Sinema and other Big Pharma-bankrolled Democrats, including Sen. Bob Menendez (N.J.) and Reps. Kathleen Rice (N.Y.), Scott Peters (Calif.), and Kurt Schrader (Ore.), have also undermined a proposal to allow Medicare to negotiate lower prescription drug costs, which would protect Americans from deadly price-gouging and save the federal government hundreds of billions of dollars per year.

"We have a rare opportunity to reform our broken tax code that has for far too long given the very wealthiest ways to avoid paying their share."

That has left the party scrambling to figure out how to pay for its heavily gutted social welfare and climate package, which can be passed through the filibuster-proof budget reconciliation process as soon as this week but only with the support of all 50 Senate Democrats and all but three House Democrats.

Just hours after Wyden introduced his plan to make a few hundred super-rich tax dodgers pay a fairer share, right-wing Democratic Sen. Joe Manchin (W.Va.), publicly expressed opposition to the idea.

After Manchin, a yacht-residing coal baron, called it divisive to raise hundreds of billions of dollars to fund child care, clean energy, and other pressing needs by "targeting" those with $1 billion in assets or $100 million in annual income for three straight years, Neal declared that congressional support for the proposal is insufficient.

Given that he has done so much to sabotage the Build Back Better Act, many believe Manchin alone is responsible for killing the BIT, but Washington Post columnist Greg Sargent made the case last week that this narrative overlooks the role played by other conservative Democrats, including Pelosi, who reportedly "destroyed" the proposal behind closed doors.

"Other Democrats are waiting in the cloakroom to kill it with no fingerprints," Sargent argued. Neal, for instance, "has questioned whether it will hold up in court," which "would dovetail with Pelosi's private opposition, and both of them working together suggest there may be plenty of other House Democrats privately opposed."

Furthermore, "other Senate Democrats appear to oppose the proposal but don't want to say so openly," Sargent added. "After all, it's not easy to come down on the side of protecting the wealth of billionaires."

Neal and Pelosi are two of the four recipients of Monday's letter, which reminds the Democratic Party's congressional leaders and tax-writing chairs that "we have a rare opportunity to reform our broken tax code that has for far too long given the very wealthiest ways to avoid paying their share."

"Now is the time," the millionaires wrote, "to pass the Billionaires Income Tax."

Join Us: News for people demanding a better world


Common Dreams is powered by optimists who believe in the power of informed and engaged citizens to ignite and enact change to make the world a better place.

We're hundreds of thousands strong, but every single supporter makes the difference.

Your contribution supports this bold media model—free, independent, and dedicated to reporting the facts every day. Stand with us in the fight for economic equality, social justice, human rights, and a more sustainable future. As a people-powered nonprofit news outlet, we cover the issues the corporate media never will. Join with us today!

Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.