Sen. Elizabeth Warren (D-MA) just tweeted what her first order of business on the Senate Finance Committee will be and it should not be all that surprising. According to Warren, “My first order of business on the @SenateFinance Committee – the committee that leads tax and revenue policy in the Senate – will be to introduce legislation for a #WealthTax on fortunes above $50 million. It is time to make the ultra-rich pay their fair share.”
If I had a dollar for every time Sen. Warren said “make the ultra-rich pay their fair share,” I would be ultra-rich by now. But, that is beside the point. Here are five simple reasons that Warren’s wealth tax won’t fly in the United States.
First, wealth taxes are unconstitutional. After all, the Sixteenth Amendment does state, “No Capitation, or other direct, Tax shall be laid, unless in proportion to the Census or Enumeration herein before directed to be taken.”
Second, a wealth tax is a form of double-taxation, which also does not pass constitutional muster.
Third, wealth taxes are easily avoided by the so-called ultra rich. Apparently unbeknownst to Warren, very wealthy people can sidestep the IRS by transferring their money to overseas accounts.
Fourth, wealth taxes inevitably backfire. Let’s say, for the sake of argument, that somehow, someway Warren’s wealth tax magically became the law of the land. If this happened, you can bet your bottom dollar that every American with a fortune more than $50 million would suddenly say adios to the United States and set their sights for greener pastures. Lest of course, they enjoy giving their money so the federal government can waste it on who knows what.
Fifth, despite Warren’s never-ending rhetoric against productive Americans, the vast majority of the nation’s tax burden is already borne by her archenemy: the ultra-rich. In fact, according to the Tax Foundation, “The top 1 percent paid a greater share of individual income taxes (38.5 percent) than the bottom 90 percent combined (29.9 percent),” based on 2017 tax data from the IRS.
In conclusion, Warren’s wealth tax has about as much a chance of becoming law as Warren becoming chief of Cherokee Nation.