Politics

Bernie Sanders Backs Top Income Tax Rate Above 50 Percent

Would significantly reduce economic growth, wages, and jobs, experts say

Bernie Sanders / AP

Bernie Sanders, a Democratic presidential candidate and avowed socialist, says the top income tax rate should be higher than 50 percent, Bloomberg reports.

He also supports raising the corporate tax rate in the United States, which is one of the highest in the developed world:

Sanders said he is "working right now on a comprehensive tax package, which I suspect will, for the top marginal rates, go over 50 percent," though he wouldn't endorse a specific rate yet. He often points out that the top marginal rate exceeded 90 percent under Republican President Dwight D. Eisenhower.

And while the White House and many Republicans want to lower the corporate tax rate, Sanders said he wants to raise it, as well as eliminate loopholes that allow corporate and wealthy taxpayers to reduce their tax bill.

"If you look at the collective percentage of revenue coming in from corporations today, it is significantly lower than it was back in the 1950s," he said. "I think it's about 10 percent today.

Some experts say returning tax rates to the levels of the 1950s would significantly reduce economic growth. According to the Tax Foundation, top rates of 80 and 55 percent—recently proposed by progressive economist Thomas Piketty—would decrease total GDP by 3.5 percent. Wages would also decline by 1.6 percent, and there would be 2.1 million fewer jobs.

Additionally, the after-tax incomes of poor and middle class citizens would decrease by 3 percent with the higher rates, the foundation said.

The current top income tax rate is 39.6 percent.

Last month, Sanders lamented the fact that an American can purchase 23 different varieties of underarm spray deodorants. "You don’t necessarily need a choice of 23 underarm spray deodorants when children are hungry in this country," he said.