Senator Elizabeth Warren (D-Mass.) said on May 4th that the Senate has the votes to pass a minimum tax on book income.
“I’ve got 50 Democrats in favor of a minimum book tax of about 15%,” she told an audience at the left-leaning Center for American Progress. “You’ve got to pay 15% no matter what. And the president of the United States is onboard with this.”
Warren said that Senate Democrats support the book tax that was passed by the House last year in the reconciliation bill called Build Back Better. The Senate has yet to approve this legislation.
The House bill includes a 15% minimum tax on corporate book income for large corporations with profits over $1 billion.
Warren suggested the minimum tax could be pulled from the reconciliation bill and used to offset the cost of other bills.
“Any time you’ve got something that you can raise revenue on, and you’re got a majority, I believe this is going to happen,” the Senator said.
Making the book income tax a reality will still require the protections from reconciliation. Under budget rules, provisions under reconciliation can pass the Senate with the support from a simple majority. So, passage would require the support of 50 Senate Democrats and Vice President Kamala Harris.
Any bill traveling under regular order (i.e., not reconciliation) will require a super majority to pass, which means Republican support. GOP Senators are highly unlikely to support enacting a book minimum tax.
Warren and the IRS:
Senator Warren spoke in favor of supplying the IRS with more revenue so it could audit wealthier taxpayers. She said the tax agency needs personnel who can keep track of taxpayers in the top 1%.
“The IRS does not have enough money to go after them… It’s hard to audit the rich folks. They get their money in all kinds of crazy places because they have all kinds of fancy lawyers on their side who hide it in lots of places.," she said
Warren also said that data shows some wealthier taxpayers cheat on their taxes, but the IRS doesn’t have the manpower to reign them in.
“It’s not that you can’t find them, but it’s just more complicated to find them,” she said. “And if the IRS is starved down to nothing. They don’t have the people who have the expertise… to be able to monitor the richest folks – the ones that we know – the data shows us – are cheating.”
There are currently several IRS reform bills in Congress, but it is not clear if lawmakers will bring them up for a vote in either chamber.
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