[S]en. Bernie Sanders outlined a plan Monday he says will rein in income inequality by raising taxes on corporations with large pay gaps between CEOs and employees. This is Sanders’ second tax policy proposal in as many weeks that targets the wealthiest people in the United States.
Sanders’ plan would apply to all private and publicly held corporations with annual revenue of more than $100 million and whose executives are making at least 50 times more than the median worker.
Those companies would have to pay an additional corporate tax rate of 0.5%. The rate could go as high as an additional 5% if executives are making more than 500 times as much money as an average employee.
The Sanders campaign says this would raise an estimated $150 billion over the next 10 years, with the revenue going towards eliminating people’s accumulated medical debt.
Sanders’ proposal allows corporations to dodge the tax hike if they choose to increase the annual median worker pay to $60,000 and reduce the annual salary for top executives to $3 million. Â
“At a time of massive income and wealth inequality, the American people are demanding that large, profitable corporations pay their fair share of taxes,” Sanders said in a statement Monday.
“It is time to send a message to corporate America: If you do not end your greed and corruption, we will end it for you,” he added.
A report from the Institute for Policy Studies, a progressive think tank based in Washington, D.C., found that nearly 80% of 500 corporations paid their CEO more than 100 times their median worker pay in 2018. Nearly 10% of those companies had median pay below the poverty line for a family of four.
Sanders has repeatedly called on companies like Amazon, Walmart, McDonald’s and others to pay workers a livable wage, as part of his crusade to raise the federal minimum wage to $15 per hour, and this plan would specifically target these large corporations.
In August of last year, Sanders announced his intention to introduce what was being called the “Bezos bill” — named for Amazon founder Jeff Bezos — which would require large employers like Amazon and Walmart to choose either paying workers a higher wage or paying taxes equal to the total cost of federal assistance programs their workers use. Amazon then decided to pay its employees at least $15 per hour.
The campaign says that under its new proposal, JPMorganChase would pay $992 million more in taxes, Walmart would send an additional $794 million to the federal government, Home Depot would see an increase of $538 million and McDonald’s would have to pay $111 million more in federal taxes.
Last week Sanders announced a plan to curb the wealth of the mega-rich by taxing millionaires and billionaires at a much higher rate and using that money to fund his affordable housing plan, universal child care and “help” to fund his Medicare for All plan.
Economists estimate that plan, which would tax the richest 180,000 households in the country, could cut the accumulated wealth of billionaires in half over 15 years, significantly changing the power dynamic in the country.