Sen. Warren on wealth tax: ‘I think most people would rather be rich’ and pay 2 or 3 cents more

Sen. Elizabeth Warren defended her latest wealth-tax proposal Tuesday, telling CNBC she believes most Americans won’t mind being rich enough to pay it.

The Massachusetts Democrat made the comments in an interview on “Squawk Box,” one day after rolling out a proposal for an annual tax of 2%, or 2 cents, on every dollar of people’s wealth worth above $50 million. Individuals with fortunes worth more than $1 billion would face an annual tax of 3%, or 3 cents, on every dollar above that threshold.

Warren campaigned on a similar wealth-tax idea during her unsuccessful campaign for the 2020 Democratic presidential nomination.

Other progressives, including Vermont Sen. Bernie Sanders, signed on to Warren’s plan as co-sponsors. During his unsuccessful presidential campaign, Sanders also favored a wealth tax.

“It’s set up now to say we’re not going to collect taxes on any asset worth less than $50,000, so this is not intrusive. It’s not about coming into people’s homes and valuing their Sub Zeros or figuring out what their 4-year-old cars are worth,” Warren said on CNBC.

“But it says if you’ve got a fortune above $50 million, you pay on it. And if your fortune is below $50 million, you don’t. Good for you, either way,” she added. “I think most people would rather be rich and pay 2 cents. This is not very fancy. It really is a tax on fortunes above $50 million.”

The idea of a wealth tax in the U.S. has faced a range of criticisms, including from Treasury Secretary Janet Yellen, who has said it has “very difficult implementation problems.”

Warren said the coronavirus crisis has exacerbated inequality in the U.S. and demonstrated a greater need for a wealth tax to generate more federal revenue, which the proposal calls to be invested in programs for early childhood education and infrastructure.

The senator said her plan would raise $3.75 trillion over the next 10 years.

“We do understand the direction we’ve been going. This pandemic has created more billionaires. The people at the top are not barely hanging on by their fingernails,” Warren said. 

Source: CNBC