Bernie Sanders follows up 'wealth tax' proposal with new 'income inequality tax'

Brendan Morrow

After rolling out his "wealth tax" plan, Sen. Bernie Sanders (I-Vt.) is out with another new proposal for what he's calling an "income inequality tax."

The 2020 Democrat announced a proposal Monday to increase the corporate tax rate on large companies whose top-earning employee makes more than 50 times what their median employee earns, The Washington Post reports. The average S&P 500 company CEO makes 287 times more than their median employee, Vox reports.

This corporate tax rate increase would apply to companies with more than $100 million in yearly revenue, with the increase starting at 0.5 percentage points and rising depending on how large the gap is. If the top employee earns more than 500 times more than the median employee, the rate increase would be 5 percent. The corporate tax rate is currently 21 percent.

Sanders in an interview with the Post said it's "bad policy" for CEOs to be "making 500 or 1,000 times more than the median income worker," saying this tax would apply to "the most egregious examples." The progressive think tank that worked with Sanders' campaign on the plan described it to Vox as a "sin tax."

In his announcement, Sanders calls out specific companies whose CEO makes at least 50 times more than the median worker, including Walmart, Home Depot, and Nike.

This announcement comes after Sanders last week announced his "wealth tax" proposal, which went further than a similar proposal from Sen. Elizabeth Warren (D-Mass.). Under his plan, net worth above $32 million would be hit with a one percent yearly tax, which would increase up to eight percent for net worth above $10 billion, The New York Times reports. In an interview with the Times, Sanders said, "I don't think that billionaires should exist."