Microsoft co-founder Bill Gates does not think the way to increase U.S. tax revenue is through policies like raising the tax rate on the wealthy to 70 percent – as has been floated by some Democratic lawmakers like New York Rep. Alexandria Ocasio-Cortez.
Continue Reading Below
During a podcast interview with The Verge, Gates responded to a question about whether raising the top rate to 70 percent in order to fund social programs – like infrastructure initiatives – appeals to him by saying government can be more effective in running social programs, but that’s not the best way to raise revenue.
“You finally have some politicians who are so extreme that I’d say, ‘No, that’s even beyond,’” Gates said. “You do start to create tax dodging and disincentives, and an incentive to have the income show up in other countries and things.”
Gates added that the country’s richest people often don’t pay the highest rate because their wealth doesn’t always show up as income, it can be in the value of their stock, for example.
“So it’s a misfocus,” he added. “If you focus on that, you’re missing the picture.”
The billionaire businessman, however, does believe there are ways to make the current tax code more progressive. Some of those ways include more progressive policies regarding the estate tax, the tax on capital, or reforming FICA and Social Security taxes. Independent Vermont Sen. Bernie Sanders recently released a proposal to expand the estate tax to a rate of 77 percent for those passing on assets in excess of $1 billion.
Bill Gates also called modern monetary theory (MMT) – which asserts that because the government controls its own currency, there is no need to worry about balancing the budget – “some crazy talk.” Ocasio-Cortez recently indicated she was open to supporting MMT.
Gates is one of the richest people in the world. He has said, despite the fact that he has paid more in taxes than most, he should be paying more.