Bill Gates says the rich should pay more in taxes
Microsoft co-founder Bill Gates, one of the world’s wealthiest people, is arguing that wealthy people like him should pay more in taxes, amid a push for higher taxes on the rich from Democratic presidential candidates.
“I think the rich should pay more than they currently do, and that includes Melinda and me,” Gates wrote on his blog earlier this week, referencing his wife, Melinda Gates.
Gates said that he thinks the rich need to pay more in taxes because the U.S. currently doesn’t receive enough in revenue to meet its obligations, and because the wealth gap in the country is growing. He floated several ways for the U.S. to raise taxes on the wealthy.
He said that the U.S. should raise taxes on capital gains, probably to the point where capital gains and labor income are taxed at the same rates. He also said he supports raising the estate tax, lifting the cap on the amount of income subject to payroll taxes and closing the “carried interest” tax break that benefits investment fund managers. Additionally, he said he supports “taxing large fortunes that have been held for a long time (say, ten years or more).”
“Very wealthy people often have large investments they’ve held for long periods, and if those investments aren’t sold or traded, the money is never taxed,” Gates wrote. “That doesn’t make sense.”
Gates made similar comments about taxing the rich at a conference hosted by The New York Times in November. He said then that his position on taxes falls “in the middle” between the tax cuts supported by Republicans and the 6-percent wealth tax on net worth over $1 billion supported by Sen. Elizabeth Warren (Mass.), a Democratic presidential candidate.
When asked at the event if he’d be willing to meet with Warren, Gates said he’s “not sure how open minded she is — or that she’d even be willing to sit down with somebody who has large amounts of money.” Warren replied on Twitter that she’d be happy to meet with Gates.
Warren’s proposed wealth tax is one of a number of proposals to raise taxes on the rich that have been floated by Democratic presidential candidates.
In his blog post, Gates said he won’t be taking a position on specific tax-the-rich proposals being debated on the campaign trail, and instead would be focusing on climate change and the issues his philanthropic foundation tackles.
Gates said he thinks policymakers need to be “thoughtful” about how high to raise taxes and shouldn’t destroy incentives to innovate, but that policymakers nonetheless have plenty of room to increase taxes on the wealthy.
“In the 1970s, when Paul Allen and I were starting Microsoft, marginal tax rates were almost twice the top rate today,” he wrote. “It didn’t hurt our incentive to build a great company.”