San Francisco, Senator Elizabeth Warren of Massachusetts, who wants to break up technology giants including Amazon, Facebook and Google if elected President in 2020, has also proposed an “Ultra-Millionaire Tax” that could significantly reduce Amazon Founder Jeff Bezos’ net worth, according to a new paper.
The proposed “Ultra-Millionaire Tax” would require 75,000 households worth at least $50 million to pay a two per cent tax on their entire net worth, rather than just their income. Billionaires would face an annual bill of three per cent, according to a report in financial news site CCN.com on Tuesday.
This “wealth tax” could impact billionaires like Bezos and Bill Gates heavily.
Economists Emmanuel Saez and Gabriel Zucman from the University of California, Berkeley in a paper revealed that if the US always had a “moderate wealth tax” equivalent to Elizabeth Warren’s proposal, it would have reduced Bezos’ net worth by $73.2 billion from the 2018 Forbes estimate of $160 billion.
“In January 2019, a major presidential candidate, Elizabeth Warren, proposed a progressive wealth tax on families or individuals with net worth above $50 million with a 2 per cent marginal tax rate (3% above $1 billion),” read the paper.
“A wealth tax such as the one proposed by Elizabeth Warren would have a large impact on progressivity within the top 0.1 per cent,” the economists wrote.
According to the estimate by Saez and Zucman, the wealth tax would have led to Bill Gates’ net worth going down to $36.4 billion from $97 billion. It would have reduced Warren Buffett’s wealth to $29.6 billion, from $88.3 billion today, said the report.