Why a Wealth Tax Is Constitutional

February 12, 2021

It’s legal, and it’s just.

The Roosevelt Rundown is an email series featuring the Roosevelt Institute’s top stories of the week.

The Legal and Economic Justifications for a Wealth Tax.

Sen. Elizabeth Warren (D-MA) has an early priority as she begins her new role on the Senate Finance Committee. 

“My first order of business on the @SenateFinance Committee—the committee that leads tax and revenue policy in the Senate—will be to introduce legislation for a #WealthTax on fortunes above $50 million,” she tweeted earlier this month. As she told MSNBC’s Joy Reid, that would amount to a two-cent tax on the top 0.1 percent of wealth-holders. 

Critics contend, as they did during the 2020 presidential primaries, that such a wealth tax is unconstitutional because of the “apportionment rule,” an integral component of the three-fifths compromise over slavery. 

Those critics are wrong. 

As Ari Glogower, David Gamage, and Roosevelt Fellow Kitty Richards explain in a new issue brief, the apportionment rule—which requires certain taxes to be apportioned among states according to their populations—does not curtail Congress’s broad power to enact a wealth tax, whether apportioned or not.

Regardless of Supreme Court justices’ personal preferences or motives, constitutional provisions and case law confirm: A wealth tax is constitutional. 

It’s also an economic necessity, as Roosevelt Program Manager Emily DiVito writes for the blog.

“Taxing income at higher rates and with fewer loopholes is important, but it doesn’t touch the wealth the very top has already amassed, and it doesn’t fairly measure a person’s or family’s true economic status or ability to pay their fair share.”

A wealth tax, she argues, would be fair, just, targeted, and effective. Learn why. 


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What We’re Reading

To Make a Lasting Impact during the Biden Administration, Support Systems-Change Leaders [feat. Roosevelt’s Felicia Wong] – Inside Philanthropy

The Biden Team Wants to Transform the Economy. Really. [feat. Wong]New York Times

Biden Presidency Starts with a Giant Bet on Run-It-Hot Economics [feat. Roosevelt’s J.W. Mason] – Bloomberg

Scoop: Biden Considering Lisa Cook for Open Fed Seat – Axios

The Path to Racial Justice Runs through This AgencyNew York Times

The Risks of Going Too Big on Stimulus Are Real—but Going Too Small Could Be Riskier [feat. Roosevelt’s Darrick Hamilton] – Vox