Bernie Sanders, a likely 2020 contender, has unveiled a plan to tax the estates of multi-millionaires and billionaires at a rate as high as 77 percent. And despite decades of GOP efforts to scare the public about the so-called “death tax,” Sanders’ proposal is a hit with voters.
Half of Americans approve of the plan, according to a new Morning Consult poll, compared with just 29 percent who oppose it. The findings align with recent polls that have found majorities support plans by Rep. Alexandria Ocasio-Cortez (D-NY) to tax income over $10 million a year at 70 percent, and by Sen. Elizabeth Warren (D-MA) to annually tax the wealth of Americans who have accumulated fortunes greater than $50 million. (For more read: Turns Out Americans Actually Do Want to Tax the Rich.)
Sanders, the Democratic Socialist Senator from Vermont, calls his proposal the “For the 99.8% Act” and claims the bill would raise $2.2 trillion from America’s nearly 600 billionaires.
“Our bill does what the American people want [by] dramatically reducing wealth inequality,” Sanders said in introducing the legislation at the end of January. “From a moral, economic, and political perspective our nation will not thrive when so few have so much and so many have so little.”
The proposal — as the branding suggests — is designed to hit only the top two-tenths of one-percent of Americans. For estates valued at more than $3.5 million, the Sanders tax rate is 45 percent. The tax would rise to 50 percent for the value of a fortune in excess of $10 million and to 55 percent for estates worth more than $50 million. Any part of an estate valued at more than $1 billion would be taxed at 77 percent. This returns the top estate tax bracket to the rate that the richest Americans paid through 1976.
The Sanders plan is unusual in that it names names. The senator has released a spreadsheet detailing what American billionaires would owe under his estate-tax hike, were they to die tomorrow. The fortunes of the nation’s richest men, Jeff Bezos ($132 billion) and Bill Gates ($96 billion), would be taxed $101 billion and $75 billion, respectively. The tax on the Koch brothers’ combined lucre ($98 billion) would yield nearly $75 billion. The $3.4 billion fortune of former Starbucks chairman Howard Schultz, who is threatening an independent 2020 run, in part based on the Democrats’ “punitive” tax policies, would be taxed more than $2 billion.
Schultz might find more to like in a new Republican proposal to eliminate the estate tax altogether, The Death Tax Elimination Act of 2019. The legislation is co-sponsored by 28 GOP senators, including even alleged moderates like Cory Gardner of Colorado. “I am proud to cosponsor this legislation,” said Senate Majority Leader Mitch McConnell introducing the bill in late January, “to finally end the unfair death tax.” The measure has little public support, backed by just 33 percent of Americans.