Biden proposes new minimum tax on billionaires, unrealized gains

The “Billionaire Minimum Income Tax” would establish a 20% minimum tax on all U.S. households worth more than $100 million, or about 0.01% of Americans. The White House projected that more than half the revenue generated by the tax would stem from the country’s 700 billionaires.

Because many of the ultra-rich derive their vast wealth from the soaring value of assets like stock and property – which are not considered to be taxable income unless that individual sells – they are able to legally store their fortunes and reduce their tax fortunes. Under current law, a gain is only taxed if and when the owner sells the asset.

“As a result, this new minimum tax will eliminate the ability for the unrealized income of ultra-high-net-worth households to go untaxed for decades or generations,” the White House said in the budget proposal.

It remains unclear whether congressional Democrats will approve of Biden’s plan to tax billionaires and ultra-millionaires.

Manchin called a different billionaires’ tax proposal from Sen. Ron Wyden, D-Ore., “convoluted,” but has since suggested that he could support some type of levy targeting the richest Americans.

Biden also proposed raising the corporate tax rate to 28% from 25% as part of his budget request and pitched a global minimum tax that’s designed to crack down on offshore tax havens.

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