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Biden’s Top 100: Understanding the billionaire minimum income tax and how it could pave the path to economic fairness

Source: Civic Media

Biden’s Top 100: Understanding the billionaire minimum income tax and how it could pave the path to economic fairness

Maggie Daun, kicks off a new segment, “Biden’s Top 100,” starting with a deep dive into the President’s proposal to level the playing field and boost the economy.

June 16, 2024 3:59 PM CDT

By: Teri Barr

Breaking down the billionaire minimum income tax proposal, Maggie Daun, host of The Maggie Daun Show, and guest Morris Pearl, chairman of the Patriotic Millionaires and former managing director of BlackRock, discuss the goal of paving a path toward economic fairness. It’s also the start of a special series, “Biden’s Top 100,” in which a different policy topic is presented in detail, noting if it is a past accomplishment or future proposal, and what it means for you and your family. You also have the opportunity to ask questions or share comments about every topic.

The Billionaire Minimum Income Tax (BMIT) is a proposal to tax wealth increases for those worth more than $100 million at 20-25%. President Joe Biden calls it a way to address the disparity where billionaires often pay lower effective tax rates than working individuals.

“This is an excellent, irrefutably great policy idea,” Pearl says. “It would help every single one of you who goes to work every day, who earns a salary, wages, or commissions. Trust me, if you work for a living, you should be in favor of the Billionaire Minimum Income Tax.”

“People often misunderstand this,” Daun responds. “They think we’re just handing billionaires a check and taxing it. But billionaires don’t work because they don’t have to. Their wealth grows from investments and assets. Shouldn’t that be taxed just like our income?”

“Exactly,” Pearl says. “The current system allows the ultra-wealthy to accumulate vast fortunes without contributing their fair share. They don’t have to sell their assets, so they don’t pay taxes on them. Meanwhile, regular folks are taxed on every dollar they earn. It’s not just unfair, it’s economically unsound.”

The economy becomes the focus as Pearl and Daun discuss the idea of money circulating among the working class, fueling growth and innovation.

“When working people have more money, they spend it,” Daun says. “It goes back into the economy, creating jobs and opportunities. But the money sitting in a billionaire’s account? It doesn’t do much good there.”

“Joe Biden’s plan targets those with wealth over $100 million,” Pearl explains. “It’s a modest tax, 20-25% on the increase in their wealth. This isn’t about punishing success; it’s about ensuring everyone pays their fair share.”

Callers and texters weigh in throughout the show. Some call the proposal a long-overdue correction for decades of economic inequality. Others share a mixed reaction. But Daun and Pearl agree, the change could lead to long-term benefits for a more equitable society.

Specific policy points from this “Biden’s Top 100” segment:

  • Tax Disparities: Wealthy individuals often pay lower tax rates (around 8%) compared to working individuals who pay 20-25%. This is due to the nature of their income, primarily from investments that are not taxed until sold.
  • Economic Impact: Lower taxes on working individuals would likely boost the economy as they spend more, while billionaires’ wealth often accumulates without contributing to the economy.
  • Tax Policy: The BMIT would tax increases in asset values even if not sold. This aims to prevent tax avoidance by holding assets indefinitely.
  • Political Influence: Billionaires can use their wealth to lobby against these types of taxes, influencing policymakers to maintain the status quo.
  • Historical Context: The top income tax rate in the U.S. was much higher (up to 94% during World War II), and significantly high rates persisted until the 1980s, when tax rates were reduced, coinciding with the rise of trickle-down economics.

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