Bernie 2020
September 30, 2019

NEWS: Sanders Releases Income Inequality Tax Plan

Sanders’ plan would increase taxes on greedy companies that pay CEOs 50 times more than median workers
WASHINGTON – Sen. Bernie Sanders on Monday unveiled his Income Inequality Tax Plan, a proposal to raise taxes on companies with exorbitant pay gaps between their executives and workers.

“The American people are sick and tired of corporate CEOs who now make 300 times more than their average employees, while they give themselves huge bonuses and cut back on the healthcare and pension benefits of their employees,” Sanders said.  “They want corporations to invest in their workers, not just dividends, stock buybacks and outrageous compensation packages to their executives.  At a time of massive income and wealth inequality, the American people are demanding that large, profitable corporations pay their fair share of taxes.  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.”
Sanders’ proposal would impose tax rate increases on companies with CEO to median worker ratios above 50 to 1. If the CEO did not receive the largest paycheck in the firm, the ratio will be based on the highest-paid employee. The tax penalties would begin at 0.5 percentage points for companies that pay their top executives between 50 and 100 times more than their typical workers. The highest penalty would kick in for companies that pay top executives over 500 times worker pay.
The tax would apply to all private and publicly held corporations with annual revenue of more than $100 million.
Here is the tax penalty structure under Sanders’ Income Inequality Tax Plan:
If a company’s compensation ratio is: Their corporate taxes would increase:
More than 50 but not more than 100  
More than 100 but not more than 200   
More than 200 but not more than 300  
More than 300 but not more than 400   
More than 400 but not more than 500   
More than 500
+0.5 percentage points
+1 percentage points
+2 percentage points
+3 percentage points
+4 percentage points
+5 percentage points
If Sanders’ plan had been in effect last year, McDonald’s would have paid up to $110.9 million more in taxes, Walmart would have paid up to $793.8 million more in taxes, JPMorganChase would have paid up to $991.6 million more in taxes, Home Depot would have paid up to $538.2 million more in taxes, and American Airlines would have paid up to $18.8 million more in taxes.

If companies increased annual median worker pay to just $60,000 and reduced their CEO compensation to $3 million they would not owe any additional taxes under this plan.

A report from the Institute for Policy Studies put the issue of outrageously high CEO pay clearly into focus. The report  found that at the 50 publicly traded U.S. corporations with the widest pay gaps in 2018, the typical employee would have to work at least 1,000 years — an entire millennium — to earn what their CEO made in just one year. Sanders’ plan would begin to put an end to this absurdity.

The details of the plan, which will raise an estimated $150 billion over the next decade, can be read here. The revenue generated from this income inequality tax will be used to pay for Sanders’ plan to eliminate medical debt.