“Right now, billionaires pay an average rate of 8% on their total income,” President Biden said, in a clip played on MSNBC Monday night. “A firefighter and a teacher pay more than double what a billionaire pays. That’s not right, that’s not fair.”
Biden has put together the “billionaire minimum income tax” in his fiscal year 2023 budget proposal. As host Lawrence O’Donnell explained it, the tax would apply only to “the wealthiest 100th of 1% of households, those with more than $100 million, and over half the revenue would come from billionaires alone. It would ensure that they pay at least 20% of their total income in federal income taxes.”
Rep. Katie Porter explained that right now, billionaires earn income that escapes the tax system. While the rest of us get taxed on every dollar that we earn, the ultra-wealthy are able to defer taxation on their income, often for decades or generations. Under Biden’s plan, they will have to include “unrealized income,” (stocks, bonds, etc.) on their tax returns and pay taxes on it.
O’Donnell pointed out that it’s like a property tax. You pay property taxes based on the unrealized value of your property every year.
You can best believe that Republicans and their ultra-rich cronies will be whining about how unfair it is. But Porter noted that the proposal is a minimum tax, meaning that if any member of the .01% of the wealthiest is already paying 20% in taxes, he or she doesn’t have to pay more.
And it’s not like Elon Musk is going to have to suddenly cough up millions. The proposal allows him and his elitist buddies nine years to pay, even though the rest of us have nothing like that leeway.
At the end of the segment, O’Donnell said he looks forward to a debate between Porter and a Republican running on Rick Scott’s plan to raise taxes on the lowest earners. We know the GOP poutrage will be dialed up to 11 over this. But the fact is that taxing the rich is super popular. Rep. Porter would make a great messenger to cut through the BS.