A day after releasing her most recent tax return, Sen. Elizabeth Warren is suggesting a surtax on corporate profits in excess of $100 million.
The presidential campaign proposal, released via the popular blog site Medium, purports to "level the playing field" for small businesses and nullify loopholes that allow companies to avoid paying any corporate income taxes to the federal government.
"We need corporate tax reform, but we also need to recognize that enormous companies with armies of lawyers and accountants will always try to exploit any deductions and exemptions that remain," the post reads. "To raise the revenue we need — and ensure every corporation pays their fair share — we need a new kind of tax that big companies can't get around."
Under what the campaign calls the “Real Corporate Profits Tax,” corporations would pay a seven percent tax on every dollar of global net income above $100 million. The charge would be based on the companies’ audited financial statement to shareholders, rather than profits reported to IRS. The tax would be levied on top of existing corporate tax liabilities.
"That means Amazon would pay $698 million in taxes instead paying zero," the post says, pointing to the highly-profitable company. This year, Amazon reportedly paid no federal taxes despite making more than $10 billion.
According to an estimate from a pair of economists the campaign cited, Warren’s plan could increase federal income tax receipts by $84 billion in fiscal 2020. Emmanuel Saez and Gabriel Zucman of the University of California-Berkeley said the tax would apply to about 1,200 companies and would bring in $1 trillion over the next decade — a conservative figure, given that the estimates are based only on public corporations. Privately-held ones are not included.
The new tax is the latest policy proposal released by the Warren camp. Others include a ban on elected and appointed officials serving as lobbyists after their terms and on federal judges and top-ranking government employees owning stock while in office, federally-funded universal child care and early learning, and the break-up of so-called tech monopolies.
Correction: An earlier version of this story misidentified the tax receipts for fiscal 2020. Warren's plan could increase the amount collected by $84 billion.
