Senator Elizabeth Warren, Democrat of Massachusetts, and Senator Ron Wyden, Democrat of Oregon and the chairman of the Finance Committee, released separate proposals last year that would tax the wealthiest, albeit in different ways. Ms. Warren had championed the idea of a wealth tax in her unsuccessful presidential campaign.
The decision by the administration to call for a wealth tax also reflects political realities over how to finance Mr. Biden’s economic agenda.
Moderate Democrats, including Senator Kyrsten Sinema of Arizona, have balked at raising the corporate tax rate or lifting the top marginal income tax rate to 39.6 percent from 37 percent, leaving the party with few options to raise revenue.
Still, Senator Joe Manchin III, Democrat of West Virginia, slammed the idea of taxing billionaires after Mr. Wyden’s proposal to do so was released, although Mr. Manchin has since suggested he could support some type of billionaires’ tax.
Top Biden administration officials have expressed skepticism about wealth taxes in the past.
Treasury Secretary Janet L. Yellen said last year that a wealth tax was “something that has very difficult implementation problems.” And Natasha Sarin, the Treasury Department’s counselor for tax policy and implementation, was a co-author of an opinion essay published by The Washington Post in 2019 that argued that a wealth tax would present “a revenue estimation puzzle.”
Legal questions about such a tax also abound, particularly whether a tax on wealth — rather than income — is constitutional. If Congress approves a wealth tax, there has been speculation that wealthy Americans could mount a legal challenge to the effort.
Steven M. Rosenthal, a senior fellow at the Tax Policy Center, said the White House proposal raised complicated questions about how taxpayers and the Internal Revenue Service would assess the value of assets that are not publicly traded and how investments that lose money would be handled.
Article source: https://www.nytimes.com/2022/03/26/us/politics/biden-billionaires-minimum-tax.html
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