Rep. Jan Schakowsky, D-Ill., has introduced a bill that would levy taxes of 45 to 49 percent on millionaires and billionaires.
Schakowsky, who was a member of President Obama’s deficit reduction commission, introduced the Fairness in Taxation Act on Wednesday. The bill would create the following new tax brackets for millionaires and billionaires:
• $1-10 million: 45%
• $10-20 million: 46%
• $20-100 million: 47%
• $100 million to $1 billion: 48%
• $1 billion and over: 49%
The current top tax bracket begins at $373,000 in income and fails to distinguish between the “well off” and billionaires, such as the top 20 hedge fund managers whose average income last year was over $1 billion, Schakowsky pointed out.
The bill would also tax capital gains and dividend income as ordinary income for those taxpayers with income over $1 million. If enacted in 2011, the Fairness in Taxation Act would raise an estimated $78 billion or more, according to Schakowsky.
“In the United States today, the richest 1 percent owns 34 percent of our nation’s wealth,” Schakowsky said in a statement. “That’s more than the entire bottom 90 percent, who own just 29 percent of the country’s wealth. And the top one-hundredth of 1 percent now makes an average of $27 million per household per year. The average income for the bottom 90 percent of Americans? $31,244. It’s time for millionaires and billionaires to pay their fair share, which is why I introduced the Fairness in Taxation Act. This isn’t about punishment or revenge. It’s about fairness. It’s about avoiding budget cuts that harm middle-class families and those who aspire to it. We can choose to cut education, job creation and health care, or we can choose to ask those who can contribute more to do so.”
The bill has attracted support from several other Democrats, including the co-chairs of the Congressional Progressive Caucus, Raul Grijalva, D-Ariz., and Keith Ellison, D-Minn., as well as Jesse Jackson, Jr., D-Ill., Donna Edwards, D-Md., Bob Filner, D-Calif., Jerry Nadler, D-N.Y., Steve Cohen D-Tenn., John Yarmuth, D-Ken., and Peter DeFazio, D-Ore.
On Thursday, House Ways and Means Committee Chairman Dave Camp,. R-Mich., proposed cutting the top tax rate for individuals and corporations to 25 percent (see Camp Proposes Cutting Top Tax Rates to 25%).