Gabriel Zucman

Then for the minimum to be effective, it has to be expressed not as a fraction of income because the whole problem is that those billionaires- Because they have no income.

They manage to report no income like Jeff Bezos.

From the perspective of the tax law, they managed to pretend that they don't have income.

As CEO of Amazon, Jeff Bezos didn't pay himself a wage.

As controlling shareholder of Amazon, he instructed the company not to distribute dividends.

He didn't sell shares, and so he didn't realize capital gains, and so his taxable income was truly zero.

Exactly.

So his true economic income is very large.

He's in the billions.

His wealth is gigantic, but he paid no income tax.

And that's legal, and that's the way the system works, but of course, it's not a good way.

It's not a good system.

So, we need to create a minimum.

For the minimum to be effective, it has to be expressed not as a fraction of taxable income, but as a fraction of wealth.

That's the basic idea.

So minimum expresses a fraction of wealth.

Then if you choose a rate of 2% on wealth, not a higher rate, it's the rate that would ensure that the billionaires would pay as much tax, all tax included, relative to their income than the rest of the population.

That's how the rate was computed.

So basically it all starts from a body of work

international research effort that was done over the last five, six years that has established that the billionaires, the super rich, have much lower effective tax rates, all tax included, than the rest of the population.