US billionaires get richer 0:59
New York (CNN Business) -
Democratic Sen. Elizabeth Warren faces an uphill battle to persuade Washington to back her billionaire tax proposal, starting with convincing her own party's Treasury secretary.
Janet Yellen, whom Warren praised last year as an "outstanding choice" to head the Treasury Department, fears that a wealth tax is too complicated to implement.
Elizabeth Warren Proposes Tax on Wealth of 'Ultra Millionaires' in the US
"So Janet and I need to have a conversation about implementation," Warren told CNN Business on Monday after introducing his Billionaires Tax Act.
Elizabeth warren
The bill would seek to raise $ 3 trillion to rebuild the economy and combat inequality by imposing a 2% annual tax on household net worth and trusts of between $ 50 million and $ 1 billion.
Billionaires would face a 3% tax.
"We designed this wealth tax based on the experiences of other countries that developed a wealth tax and were not always successful," Warren said in the interview.
"We saw where the bugs were and made sure to fix them."
$ 100 billion for the IRS to fight tax scammers
Critics argue that taxing wealth would be challenging, if not unconstitutional.
In particular, there are concerns about how to value assets and prevent the rich from hiding money abroad.
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Yellen, the former head of the Federal Reserve, told a DealBook conference last week that she is not planning a wealth tax like Warren's because it is "something that has very complicated implementation problems."
"People say, 'Well, the rich cheat, so we shouldn't even try to use a wealth tax,'" Warren said.
“But if the rich cheat, that doesn't mean we should just give up and let them pay taxes at lower rates than everyone else.
That means we have to hire more law enforcement officers and make them follow the rules. "
Warren's estate tax has teeth.
The legislation has a built-in audit rate of 30%, which means that each year almost a third of all families would be audited.
And the bill calls for increasing the Internal Revenue Service (IRS) budget by $ 100 billion to build the agency's audit capacity and modernize information technology systems.
American billionaires have enriched $ 1.1 trillion during the pandemic
Warren's plan also proposes a 40% "exit fee" on the net worth of more than $ 50 million for any US citizen who renounces their citizenship to avoid paying the tax.
“Once you have implemented the wealth tax, it is not very difficult to monitor year after year.
If someone owned real estate last year, this year they better own that same real estate or have a lot of cash from a sale, ”Warren said.
Equity in the tax system
When asked if President Joe Biden has any interest in a wealth tax, White House press secretary Jen Psaki said during Monday's press conference that Biden "strongly believes that ultra-millionaires and corporations they need to finally start paying just enough. '
"He has been presented with a lot of ideas and when we get to that point on our agenda, he will be eager to work with [Warren] and others in Congress," Psaki said.
In other words, the White House did not rule it out.
Last year, 99% of households at the bottom tier paid about 7.2% of their total wealth in taxes, according to Warren.
However, the tenth of the 1% at the top paid only 3.2% of their estate in taxes.
Warren said there is bipartisan support among voters for a wealth tax, including a majority of independents and Republicans.
"They understand how unfair the current system is," he said.
The fight for the minimum wage of $ 15
Warren also supports an effort to override the Senate MP by keeping the $ 15 minimum wage increase in the covid aid package.
Such a move hasn't been used since 1975 and could cause support to dwindle among moderate Democrats like Sen. Joe Manchin.
"I would be happy to see us pass the minimum wage through reconciliation," Warren said, referring to the budget process that requires only a simple majority to pass.
And I will fight for that.
When asked about Manchin and other moderates who oppose popular measures like the $ 15 minimum wage, Warren focused on the Democrats' points of agreement.
"The Democrats want us to raise the minimum wage," he said.
“We need to talk more about what exactly the level is and how to do it.
But we want the minimum wage to rise.
Taxes
