Sanders joins the Democrats' tax party with new levy on large estates

WASHINGTON — Sen. Bernie Sanders, I-Vt., released a bill that would dramatically increase the estate tax for multi-million dollar inheritances, becoming the second potential 2020 candidate this week to propose major new taxes on the ultra-wealthy.

Increasing the tax burden on the rich to fund new social spending or lower-income tax cuts is fast becoming a major theme of the Democratic presidential contest as several potential candidates are proposing additional tax increases aimed at the rich that would target investments, inheritances and wealth.

Under Sanders' "For The 99.8 Percent Act," so named because it would only apply to the richest 0.2 percent of Americans, the estate tax would rise to 45 percent on estates between $3.5 million and $10 million, 50 percent on estates between $10 million to $50 million, 55 percent on estates over $50 million and top out at 77 percent on $1 billion-plus fortunes.

"Our bill does what the American people want by substantially increasing the estate tax on the wealthiest families in this country and dramatically reducing wealth inequality," Sanders said in a statement. "From a moral, economic, and political perspective our nation will not thrive when so few have so much and so many have so little."

RELATED: Bernie Sanders and Barack Obama

15 PHOTOS
Barack Obama and Bernie Sanders
See Gallery
Barack Obama and Bernie Sanders

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

UNITED STATES - JANUARY 08: From left, Senate Majority Leader Harry Reid, Sen. Bernie Sanders, I-Vt., Sen. Russell Feingold, D-Wisc., and Sen. Barack Obama, D-Ill., participate in a news conference on Senate ethics reform legislation in the Senate TV studio on Monday Jan. 8, 2006.

(Photo By Bill Clark/Roll Call/Getty Images)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Bernie Sanders (R) walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Sen. Bernie Sanders (D-VT) walks with President Barack Obama through the Colonnade as he arrives at the White House for an Oval Office meeting June 9, 2016 in Washington, DC. Sanders met with President Obama after Hillary Clinton has clinched the Democratic nomination for president.

(Photo by Alex Wong/Getty Images)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S., June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Bernie Sanders delivers a statement after his meeting with U.S. President Barack Obama (not pictured) at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

Democratic presidential candidate Sen. Bernie Sanders (D-VT) walks with President Barack Obama through the Colonnade as he arrives at the White House for an Oval Office meeting June 9, 2016 in Washington, DC. Sanders met with President Obama after Hillary Clinton has clinched the Democratic nomination for president.

(Photo by Alex Wong/Getty Images)

US President Barack Obama walks with Democratic presidential candidate Bernie Sanders through the Colonnade for a meeting in the Oval Office on June 9, 2016 at the White House in Washington, DC.

(MANDEL NGAN/AFP/Getty Images)

Democratic presidential candidate Bernie Sanders and his wife Jane leave the West Wing of the White House after his meeting with U.S. President Barack Obama in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

U.S. President Barack Obama, and Senator Bernie Sanders, an independent from Vermont and 2016 Democratic presidential candidate, walk to the Oval Office of the White House in Washington, D.C., U.S., on Thursday, June 9, 2016. Obama said yesterday he expects Democrats to unify soon behind their presumptive presidential nominee, Hillary Clinton, and that her divisive primary contest with Sanders was healthy for the party.

(Photographer: Andrew Harrer/Bloomberg via Getty Images)

Democratic presidential candidate Bernie Sanders walks with U.S. President Barack Obama to the Oval Office at the White House in Washington, U.S. June 9, 2016.

(REUTERS/Gary Cameron)

HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

The bill sets up a potential general election contrast with President Donald Trump, who cut taxes on large inheritances by doubling the size of estates that are exempted before the current 40 percent rate kicks in. It now applies only to estates larger than $11.2 million and $22.4 million for couples. Senate Majority Leader Mitch McConnell, R-Ky., introduced a plan this week with a group of Republican senators that would go further and repeal the tax entirely.

Release of the Sanders plan also comes just days after Sen. Elizabeth Warren, D-Mass., proposed an "ultra-millionaire tax" that would impose a 2 percent annual tax on fortunes over $50 million and 3 percent on fortunes over $1 billion.

Both the Sanders and Warren bills were released with public backing from some of the same economists, University of California-Berkeley professors Emmanuel Saez and Gabriel Zucman, who are known for their work on inequality. The French economist Thomas Piketty also endorsed Sanders' bill in a statement provided by the senator along with former Labor Secretary Robert Reich and New School professor Darrick Hamilton, who has consulted on a variety of proposals among Democrats in the mix for 2020.

Read Full Story

Sign up for Breaking News by AOL to get the latest breaking news alerts and updates delivered straight to your inbox.

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.