By Issues & Insights Editorial Board | July 07, 2026
It took less time than we would have imagined, but proponents of the “billionaire wealth tax” have already given the game away.
Anyone who knows any history about taxes knows that the left always uses “tax the rich” as a cover to raise taxes on the middle class. Because, as Willy Sutton observed in another context, that’s where the money is.
But we were surprised to see Rep. Ro Khanna admit as much, even before he and his socialist pals get their coveted wealth tax on the boards.
“The tax should not stop at billionaires,” he wrote on his Substack. “The tax has to reach all fortunes $50 million and up.”
So why is the bill he sponsored along with Sen. Bernie Sanders called the “Make Billionaires Pay Their Fair Share Act”?
Because that’s how it always goes with new taxes.
Take the experience in Europe, where 14 countries tried a wealth tax, after which 11 ditched the idea because it didn’t raise much money.
The European wealth taxes that stayed rich-only — France, Sweden, Germany, Austria, Denmark — were repealed as revenue duds. The ones that survived did so by reaching the middle class … Norway’s kicks in at around $160,000 of net worth. The Netherlands taxes deemed returns on assets above roughly €57,000. Swiss cantons start in the low six figures. The slippery slope is quite literally the only way these things ‘work.’
But you don’t need to look abroad. Democrats have already been pushing wealth taxes that reach far more than “billionaires.” When Sen. Elizabeth Warren introduced her wealth tax in 2019, it kicked in at $50 million. That threshold has already been reduced because, while the number hasn’t changed in seven years, Bidenflation has reduced the inflation-adjusted threshold to $39 million.
Then there’s Joe Biden’s 2022 “Billionaire Minimum Income Tax,” which kicked in at $100 million.
The history of the U.S. income tax provides more concrete evidence of this trickle-down tax.
As we noted in this space in March (see “The Middle Class Will Pay For Washington’s ‘Millionaire Tax’”):
When the federal government first imposed an income tax in 1913, it was very much like a millionaire’s tax.
The law included a $3,000 personal exemption, which is equal to roughly $100,000 today. And even then, the rate was a mere 1% up to $20,000 (or $670,000 in today’s money). And the seven tax brackets topped out at 7% on incomes that in today’s dollars would exceed $17 million.
Just five years later, the personal exemption had been cut down to $1,000, the lowest bracket had been hiked to 6%, and there were 49 more tax brackets, with the top one set at 77%.
Then there’s the inconvenient truth that tax hikes on the “rich” always serve as political cover for tax hikes on the middle class.
Again, from our editorial:
When George H.W. Bush raised the top rate in 1990, he also raised taxes on things like beer, cigarettes, and gasoline. Bill Clinton and Joe Biden performed the same trick when they raised taxes on the rich. In contrast, when Ronald Reagan, George W. Bush, and Donald Trump cut the top tax rate, they also slashed taxes for the middle class.
Anyone who expects a “billionaire” wealth tax to be any different is living in fantasyland.
As an aside, we should point out that Rep. Khanna is a textbook socialist.
As the Washington Free Beacon exposed in a must-read investigative piece, “the progressive, Silicon Valley congressman and his family live a life of staggering luxury, fueled by dynastic wealth they did not earn and protected by the same thicket of trusts, anonymous corporations, and foundations that Khanna condemns.” (emphasis added)
That includes the family’s $6 million, 8,000-square-foot luxury home with a four-story elevator and his wife’s $190,000 Range Rover.
So, Khanna is surely a hypocrite of epic proportions. But at least he’s sort of honest about his “billionaire” tax.
Issues & Insights was founded by seasoned journalists of the IBD Editorials page. Our mission is to provide timely, fact-based reporting and deeply informed analysis on the news of the day – without fear or favor.
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