Bernie Sanders’ proposed tax on billionaires would impose a substantial levy on approximately 900 individuals to finance $3,000 checks for the middle class.
Consider a small concert venue, perhaps accommodating around 900 individuals. This figure is comparable to the size of a modest cruise ship or the average public high school in the U.S. Such a group collectively possesses more wealth than the bottom half of the nation combined, as this is roughly the number of billionaires residing in the U.S. However, a new legislative proposal seeks contributions from this hypothetical group to finance thousand-dollar payments for millions of middle-class Americans.
Senator Bernie Sanders and Representative Ro Khanna introduced the “ on Monday, proposing a 5% annual wealth tax on individuals with a net worth of $1 billion or more. Sanders estimates that 938 billionaires live in the U.S., holding a collective $8.2 trillion.
This $8.2 trillion would not solely flow into government coffers. The proposed bill directs some of this revenue back to citizens. In its inaugural year, tax proceeds would fund a one-time $3,000 payment for every person in a lower- or middle-income household, defined as those earning $150,000 or less.
While the legislation faces considerable obstacles given Republican control of the House and Senate, the bill aligns with a series of proposals aimed at redistributing billionaire wealth. A major labor union in California, for instance, introduced a similar measure—a 5% tax on state residents with a net worth of $1 billion or more—though framed as a one-time rather than recurring tax. That California bill has reportedly triggered an exodus from the state, with Google co-founders Sergey Brin and Larry Page among those who have announced their departure. In 2023, the Biden Administration also put forth a comparable bill—a 20% minimum income tax for households with a net worth of $100 million or more—which met with limited success.
Sanders envisions this bill would be different. According to a press release introducing the legislation, revenue from subsequent years would be directed toward the “most pressing crises facing working families,” projected to generate $4.4 trillion within its first decade. Sanders and Khanna stated the funds would reverse $1.1 trillion in cuts to Medicaid and the Affordable Care Act from the One Big Beautiful Bill Act, establish a minimum $60,000 salary for public school teachers, and cap parental childcare payments at 7% of household income.
“At a time of unprecedented income and wealth inequality, this legislation demands that the billionaire class in America finally pay their fair share of taxes so that we can create an economy that works for all of us, not just the 1%,” Sanders declared in a press release.
Billionaires have increasingly drawn the ire of discontented Americans, many of whom perceive the ultra-wealthy as a threat to the country, according to a recent survey. Despite 60% of Americans expressing a desire to become a billionaire, 53% believe billionaires pose a threat to democracy, a seven-point increase from the previous year’s survey.
Calculating the Tax Impact
Sanders’ press release references an analysis by University of California, Berkeley researchers Emmanuel Saez and Gabriel Zucman. Their report illustrates the long-term effect of a 5% wealth tax on America’s 10 richest individuals, applying the 5% tax to their wealth for every year they have held billionaire status. The calculations suggest that billionaires’ wealth would effectively halve annually.
Tesla CEO Elon Musk, currently the nation’s wealthiest person, would see his fortune decline from approximately $745 billion to $363 billion if a 5% tax had been applied to his wealth every year since he became a billionaire in 2012. Google co-founder Larry Page’s wealth would decrease from $258 billion to $83 billion if the same tax had been applied each year since he achieved billionaire status in 2004.
“Democracies become oligarchies when wealth becomes too concentrated,” the researchers wrote. “The US has now reached an unprecedented level of top wealth concentration.”