Wednesday, March 25, 2026, episode of the podcast The Excerpt: The gap between rich and poor in America is expanding explosively, with the top 0.1% leading the way. As calls for a wealth tax grow, USA TODAY personal finance reporter Daniel de Visse joins The Excerpt to analyze what taxing the ultra-wealthy could mean for the economy and ordinary Americans.
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Dana Taylor:
According to independent.org, a project of the Institute for Policy Studies, income inequality in the United States has skyrocketed and is reminiscent of the Gilded Age. From 1979 to 2021, the average income of the top 0.1% of households grew nearly 27 times faster than the bottom 20%, according to the Congressional Budget Office. This raises a question that is being asked across the country today: Should the very wealthy be subject to a special tax?
Hello. Welcome to this excerpt from USA TODAY. I’m Dana Taylor. Today is Wednesday, March 25, 2026. Joining us to discuss the possibility of a wealth tax is USA TODAY personal finance reporter Daniel de Vis. It’s great to have you back, Daniel.
Daniel de Visse:
I’m happy to be here.
Dana Taylor:
Daniel, can you give us an overview of how you got here? What has spurred this national debate about a wealth tax?
Daniel de Visse:
The country has progressive taxation, meaning people who earn more generally pay more in taxes at higher income levels. But now, if you compare it to 40, 50, 60 years ago, top tax rates, top tax rates, top incomes are lower than they were in the past. Even during the Clinton era and in the 1990s, marginal tax rates for top earners were significantly higher than they are today.
President Trump has made a big deal of lowering tax rates, and his critics will say he’s been cutting taxes, especially for high-income earners. And the world of capital gains, basically stock profits, opens up. And the taxes on them will be lower. And if you keep your assets in something like a tax-advantaged account, as wealthy people do, you may be able to pass them on to your heirs without paying taxes. So there is this kind of perpetuation of wealth. And certainly, the concentration of money among people like billionaires is probably at its highest in 100 years.
Dana Taylor:
Understood. Let’s dig into this starting with California. What is happening there?
Daniel de Visse:
The Billionaires Tax exists and it is out there. So there are a lot of wealth taxes in place all over the country, especially in blue states. But this is outside. That’s an outlier. A one-time 5% tax on billionaires’ assets would likely raise $100 billion. What this means is that if you’re a suburban household and you have a net worth of maybe $1 million, I’m not saying who’s being taxed here, but just for reference, you’re going to pay $50,000 in one-time taxes.
Obviously, if that happened in my suburb of Maryland, all hell would break loose, pardon the French. But that’s what this billionaire’s taxes are. Apparently there are 200 millionaires. Well, it’s less now because some people have said they’re leaving, but there are 200 millionaires and each of them will pay a one-time 5% tax. Since it is a voting measure, it is necessary to go through a process of collecting signatures. Not all have been gathered yet. If we can get signatures, I think we’ll have 900,000 signatures, and a vote will be held in November.
Dana Taylor:
Washington Governor Bob Ferguson has a wealth tax bill on his desk ready to be signed into law. What’s on that bill, Daniel?
Daniel de Visse:
Therefore, Washington State currently has no income tax. This means that it is one of the states that does not pay state income tax. But that came as the governor was talking about the idea of growing wealth inequality in the state and elsewhere. So even in a kind of competitive arena, the lawmakers there have approved, it’s about a 10% or 9.9% tax. This may be due to income. Therefore, not all of the assets of these wealthy people are eligible. His income is said to be over 1 million yen. And while these wealth tax patterns are seen in other states, California is generally kind of forgotten about. In other regions, incomes of $1 million or more are eligible, as are households. So if you’re a couple of high school teachers who each make $100,000, you’re nowhere near this. That means 0.5 percent of Washington state residents will pay about 10 percent in taxes only on the portion of their income over $1 million.
Dana Taylor:
The centerpiece of New York Mayor Zoran Mamdani’s bill is a wealth tax. What does that bill look like?
Daniel de Visset:
Mamdani campaigned on the idea of taxing the wealthiest New Yorkers. That’s also people who earn more than $1 million a year, who would have their taxes raised… New Yorkers already pay taxes on that income, which would be increased by 2 percentage points to a maximum of 5.9%. He said it would raise $4 billion a year. I think New York continues to have a budget deficit.
The reality is that that hasn’t happened yet. In New York, of course, there are negotiations going on now between Mamdani, the mayor, and Congress, which I think is generally a blue state, and a lot of people in that Congress don’t necessarily like the idea of taxing wealthy New Yorkers. There is a perennial fear, and this is common to all ideas of wealth taxes, of getting rid of the wealthy and simply moving away without paying taxes.
Dana Taylor:
Wealth tax on incomes over 1 million passed in Massachusetts in 2022. Daniel, how many households were affected there and what did the state do with the money?
Daniel de Visse:
I don’t know the exact numbers. Probably less than 1% of people living in Massachusetts pay the 4% surcharge on income over $1 million. It’s a very wealthy state, but still very few people make that much money. I think it brought in about $6 billion, which is significant. There’s not much evidence that people left Massachusetts without paying that tax. This is important. I’ve looked into a lot of research, but will people flee in the face of a wealth tax? This is a bit of a new area, but most of the research seems to suggest that wealthy people generally don’t move because their taxes will go up slightly. They move for all sorts of reasons. And in California, this may be different because that tax is actually an outlier. That’s a big tax. But generally speaking, research seems to show that raising taxes a little doesn’t move the wealthy.
Dana Taylor:
As you know, Warren Buffett is famous for advocating progressive taxation. What is Buffett’s Law?
Daniel de Visset:
Buffett’s Law, which I believe was actually proposed by President Obama, is, again, based on this $1 million income, and if you make more than that in a year, you have to pay at least 30% of your income in federal taxes. This is much more than most people at that level pay. Warren Buffett’s idea was that, in effect, the wealthy would not be taxed at the same rate as ordinary working people. And the reason, again, has to do with investment returns, which tend to be taxed at lower rates, if at all. If you have millions of dollars invested in a tax-advantaged fund like an IRA, you may pay little to no taxes while it’s held in those accounts.
Dana Taylor:
When Sen. Bernie Sanders was running for the Democratic presidential nomination, he advocated a wealth tax. Has a federal plan to tax the wealthy made progress in Congress?
Daniel de Visset:
Now, while Sen. Sanders is in favor of the California Wealth Tax, it is important to note that it is a divisive issue as California Governor Gavin Newsom, a Democrat, strongly opposes this billionaire tax. Mr. Sanders agrees with that. It’s coming from the California unions. And typically, this is the kind of proposal that a senator proposes but not many people support. The current Republican-controlled Congress certainly won’t pass the bill any time soon, but even many Democrats are wary of it to some degree. However, I would like to say that the public generally supports the idea of a wealth tax.
There was a poll that was done about this California billionaire tax, and I think about 50% of California voters said they supported the idea of this huge tax on billionaires, and about 28, 29% said they were against it. Similarly, Gallup found that about 12% of the public believes the wealthy already pay too much in taxes. Therefore, most people think they are not paying enough or the right amount.
Dana Taylor:
Daniel, what do the critics of such a tax say?
Daniel de Visset:
A recurring criticism of all these wealth taxes is that they will drive out the wealthy. In other words, if Washington, California, Massachusetts, or New York imposed a tax on their wealthiest residents, those with means would simply move away. They’ll move to Florida instead of paying taxes, they’ll move to Texas.
Now, again, research shows that not that many people actually pay taxes, but it’s more difficult for states to escape these types of taxes. Because if a state like California requires billionaires Larry Page or Sergio Brin to turn over 5% of their assets, California has 49 other states competing with them. And some people, including these two, have expressed their intention to transfer. they can move. They have a lot of money and will just move away rather than pay this high one-time tax. That’s the danger. And it will be very interesting to see how this California bill plays out if it becomes law. Because this is an outlier, the most extreme wealth tax ever proposed.
Dana Taylor:
What will you focus on next in terms of wealth tax?
Daniel de Visse:
Well, the interesting questions are, first of all, whether this California bill is going to become a reality, whether there’s a lot of money being spent by some very wealthy people to oppose it, whether it’s going to be on the ballot at all, whether there’s going to be a huge publicity campaign to get it voted out. And once it becomes law, we’ll see if these 200 billionaires in California actually make a move. This will be the biggest test we have had for the idea of a wealth tax. That’s the big question.
Dana Taylor:
It’s okay to have these problems. Daniel de Vis is a personal finance reporter for USA TODAY. Thank you so much, Daniel.
Daniel de Visse:
Thank you for having me.
Dana Taylor:
We would like to thank Senior Producer Kaely Monahan for her production assistance. Executive producer is Laura Beatty. Let us know what you think about this episode by sending a note to podcasts@usatoday.com. Thank you for your attention. I’m Dana Taylor. Tomorrow morning, we’ll bring you another episode of USA TODAY excerpts.
