President Joe Biden and others have proposed monumental steps toward making our tax system fairer to help fund universal pre-K, free community college, national paid family and medical leave, and other critical priorities. The new revenue could also help fight the mental health and addiction epidemics in our country, which have killed over 840,000 people in the past 20 years and have no vaccine cure.
But reforming our tax system should not just be about paying for major programs. It should be about making sure billionaires, corporations and, frankly, people like me pay their fair share. Tax fairness should be a goal in and of itself.
The good news is there is no shortage of good ideas to make our tax code more equitable.
First, we need to tax capital gains for wealthy Americans just like ordinary income. Coffee shop baristas pay taxes on their earned income every year. If they don’t, the IRS will be on their doorstep. But wealthy investors can defer taxes for decades on money they make in the stock market, real estate or some other investment.
But the real scam is a giant loophole in our tax code known as stepped-up basis. This allows wealthy Americans to avoid paying any taxes on their investment gains for their entire life if they keep it until they die and pass it along to their children. More than 60 percent of the wealth of billionaires, nearly $3 trillion dollars, goes untaxed because of this loophole. While every other American pays a tax on their income, the rich…