Oct 7, 2019

The overall tax rate for the richest 400 households last year was 23%

Axios

Hudson Yards neighborhood in Manhattan. Photo: Spencer Platt/Getty Images

The 400 wealthiest Americans last year paid a lower total tax rate for federal, state and local taxes than any other income group for the first time on record, according to the New York Times.

Why it matters: Tax rate for the wealthy has steadily dropped since the 1950s and 1960s, when the wealthy paid vastly higher tax rates than the middle class or poor.

By the numbers: The overall tax rate for the richest 400 households last year was 23%, down from 70% in 1950 and 47% in 1980.

  • The data used in the piece comes from the from a book called “The Triumph of Injustice,” to be released next week.
  • The authors are University of California, Berkeley professors Emmanuel Saez and Gabriel Zucman, who are economic advisers to Elizabeth Warren's 2020 presidential campaign.

Go deeper: Americans are saving at an unusually high level after Trump's tax cuts

Go deeper

Ursula Perano

Mitt Romney opposes cutting capital gains tax rate for the rich

In an interview with Mike Allen for "Axios on HBO," Republican Sen. Mitt Romney said he opposes cutting the capital gains tax rate for the rich.

The big picture: Republicans typically argue that cutting the capital gains tax rate will boost economic growth and provide room for increased spending. Democrats argue that doing so disproportionately benefits the rich.

Go deeperArrowOct 20, 2019
Ursula Perano

Architects of Elizabeth Warren wealth tax say we're in new Gilded Age

In an interview with Axios' Mike Allen for "Axios on HBO," economists Emmanuel Saez and Gabriel Zucman, who helped guide Democrat Sen. Elizabeth Warren's 2020 wealth tax plan, said America has entered a new Gilded Age.

The big picture: Warren's "ultra-millionaire tax" is one of the most progressive tax plans on the Democratic market. It aims to adjust rates so that the rich are not paying less, proportionately, in taxes than the wealthy. Opponents of the plan argue it would de-incentivize investments and stifle economic growth.

Go deeperArrowOct 20, 2019
Dion Rabouin

Former Treasury chief Larry Summers does not like the wealth tax

Adapted from Emmanuel Saez, 2019, "Taxation of Financial Capital: Is the Wealth Tax the Solution?; Chart: Andrew Witherspoon/Axios

A Twitter debate about the veracity of an economic study projecting the outrageously low tax rates of billionaires turned into a verbal street brawl at the Peterson Institute for International Economics in Washington Thursday.

Background: Criticism has been heaped on a Washington Post op-ed by Emmanuel Saez and Gabriel Zucman purporting to show that for the first time in U.S. history billionaires paid a lower tax rate than the working class.

Go deeperArrowOct 18, 2019