American Democrats detail their plan to tax the super-rich

They draw the outline of a tax on the gains not yet realized.

Democratic Senator Ron Wyden, head of the US Senate Finance Committee, presented on Wednesday the outlines of the tax on the super-rich, which should help finance Joe Biden’s vast investment plans.

«The billionaire income tax would apply to around 700 taxpayers and raise hundreds of billions of dollars, ensuring that the country’s richest people pay their fair share to (fund) historic investments in the childcare, paid leave and the fight against the climate crisis“, According to this project published Wednesday.

Difficult compromise

The Biden administration plans to spend up to $ 3.5 trillion but is struggling to rally all the fringes of the Democratic Party on their funding. Ron Wyden’s text states that “only taxpayers with more than $ 100 million in annual income or more than $ 1 billion in assets over three consecutive years would be covered by the proposal“. The great novelty is to tax unrealized capital gains, these dormant gains in the thick portfolios of stocks of great American fortunes.

Today, a wealthy shareholder like Elon Musk, boss of Tesla or Jeff Bezos, the founder of Amazon, does not pay tax on these unrealized capital gains on the pretext that these gains do not exist until they do. are not actually cashed.

The current tax code mainly targets payroll taxes “fueling the concentration of dynastic wealth among billionaires», Notes the text. It allows “some richer»To avoid paying taxes by holding indefinitely these assets which nevertheless allow them to borrow and finance a way of life, further explains the text, with reference to the possibility of buying luxury houses, yachts, etc., these assets being collateral.

«As a result, middle class families who derive their income from their wages may face higher average tax rates than billionaires.», Denounces the text.

First harvest of 3,000 billion

Ron Wyden’s proposal would start by imposing a single tax on all gains accumulated before the creation of the tax, which will allow a large amount to be collected in one go since this stock of unrealized capital gains is estimated at some 3 trillion dollars. dollars by Forbes. Then, Wyden’s plan would impose taxes on capital gains based on annual appreciation with different rules for different types of assets.

Conversely, the text provides for the possibility of deducting taxes in the event of losses whether or not they sell the asset. “Taxpayers could defer losses for up to three years under certain circumstances», Mentions the text.

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