Michael Bloomberg, NYC Billionaires Could Pay 20% More In Taxes

NEW YORK CITY — The tax man soon could be coming for Michael Bloomberg. Big time.

Bloomberg is among 99 billionaires in New York City who could pay 20 percent more in taxes under a proposal by President Joe Biden.

Biden included a “Billionaire Minimum Tax” in his fiscal year 2023 budget proposal that aims to target the ultra-wealthy like Bloomberg, who pay very little in income tax.

The tax would apply only to the top one-hundredth of 1 percent of Americans, Biden said at a news conference, but would raise “$360 billion that can be used to lower costs for families and cut the deficit.”

“Now, I’m a capitalist, but … if you make a billion bucks, great,” Biden said. “Just pay your fair share. Pay a little bit.

“A firefighter and a teacher pay more than double — double the tax rate that a billionaire pays. That’s not right. That’s not fair.”

Bloomberg, for example, recently avoided paying any income tax, according to a bombshell ProPublica report. The former New York City mayor is currently the 20th wealthiest person in the world, with a net worth of $59 billion, according to Forbes’ Real-Time Billionaires ranking.

ProPublica found Bloomberg paid a "true tax rate" of 1.3 percent between 2014 and 2018. Bloomberg, for his part, told the outlet through a spokesperson that he pays the maximum tax rate on all local, state, federal and international taxes, and only keeps about 25 cents of every dollar he makes because of charitable giving.

But the ProPublica investigation highlighted an issue that Biden's proposal seeks to address — namely, that the wealthiest 0.001 percent of Americans pay little in taxes because their wealth isn't derived from wages, but rather the value of assets like stock and property.

Those don't count as income — and aren't taxed — unless billionaires sell them off.

Biden's proposal calls for households worth more than $100 million to pay at least 20 percent in taxes on both income and “unrealized gains,” or the increase in an unsold investment’s value. Many wealthy people hold onto these investments for decades, meaning they’re never taxed, administration officials said.

The proposed policy is “extremely nuanced,” according to an Associated Press explainer. It would allow wealthy households to spread some payments of their unrealized gains over nine years, and for five years on new income going forward. In effect, the AP explained, the payments are a prepayment on tax obligations they will owe when the investments are sold.

Beyond Bloomberg, here are some New York City billionaires with places on Forbes' Real-Time Billionaires ranking who could be affected by the tax plan:

• Julia Koch and family, 27th on the ranking, Koch Industries, whose net worth was $46.4 billion as of Wednesday;
• Alain Wertheimer and Gerard Wertheimer, Chanel, 41st on the ranking, whose net worth was $34.5 billion as of Wednesday;
• Leonard Lauder, Estee Lauder, 64th on the ranking, whose net worth was $25.5 billion as of Wednesday;
• Rupert Murdoch and family, media magnate, 71st on the ranking, whose net worth was $23.5 billion as of Wednesday;
• Ralph Lauren, apparel, 358th on the ranking, whose net worth was $7.1 billion as of Wednesday

The proposal could be met with resistance by moderate Democrats, including Sens. Joe Manchin of West Virginia and Krysten Sinema of Arizona, but it gives Democrats a talking point as inflation reaches a 40-year high. At the same time, for Republicans who oppose it, it creates a political liability of appearing to side with multibillionaires.