Senator Bernie Sanders of Vermont, a potential Democratic presidential candidate known for far-left stances on issues of economic inequality, introduced legislation on Thursday that would increase the number of wealthy Americans subject to the estate tax.
With the bill, Mr. Sanders joins a growing chorus of left-wing politicians calling for new ways to tax the rich. Last week, Elizabeth Warren, the Massachusetts senator who has announced her 2020 candidacy, introduced a plan for a so-called ultramillionaire tax on households with a net worth of $50 million or more. And Representative Alexandria Ocasio-Cortez of New York recently proposed a 70 percent top rate on income over $10 million a year, intensifying the conversation within the Democratic Party about tax policies aimed at addressing income inequality.
In his plan, Mr. Sanders proposed applying an estate tax when someone leaves assets worth more than $3.5 million to his or her heirs, the same level as in 2009. The plan significantly lowers the threshold under the current tax law, passed in late 2017, which raised the amount an individual is allowed to transfer before facing any estate tax to roughly $11 million; couples can pass on twice that much.
The tax-the-rich proposals, including the one introduced by Mr. Sanders, are designed to increase revenue to pay for expanded social programs like “Medicare for all.’’
Though Mr. Sanders, 77, has not yet announced he is running for president, he appears to be actively moving toward a 2020 campaign.
Republicans, for their part, have repeatedly tried to thwart efforts to broaden the estate tax, which they call the “death tax.” President Trump has described the estate tax as “crushing,” “horrible,” and “unfair,” and on Monday, three Republican senators including Mitch McConnell, the majority leader, introduced legislation to permanently repeal the estate tax. Mr. Trump and other opponents of the estate tax have positioned a repeal as a way to help farmers, ranchers and small business owners
Mr. Sanders’s estate tax plan, which he said would affect the wealthiest 0.2 percent of Americans, is similar to one he introduced during his 2016 presidential campaign, when he finished second to Hillary Clinton in the Democratic primary race. Mr. Sanders also supports the idea of a wealth tax, which he outlined in a list of financing options for “Medicare for all.”
In addition to expanding the number of Americans affected by the estate tax, Mr. Sanders’s plan establishes different tax rates depending on the size of the inheritance. An estate valued from $3.5 million to $10 million would be taxed at a rate of 45 percent, for instance. A top rate of 77 percent would be levied on estates valued in excess of $1 billion.
The plan would also end tax breaks for so-called dynasty trusts, which allow the wealthiest Americans to transfer their wealth from generation to generation for hundreds of years without paying estate or gift taxes.
“Instead of repealing the estate tax as Sen. McConnell proposed this week, we need to substantially increase the estate tax on the wealthiest families in America and reduce wealth inequality in America,’’ Mr. Sanders said in a statement. “We need a tax system which asks the billionaire class to pay its fair share of taxes and which reduces the obscene level of wealth inequality in America.”