Biden's Proposed Billionaire Tax Spotlights the Unconstitutionality of Our Current Tax System

Mar 30, 2022

The Biden administration continues to prove, with each passing day, that they have little regard for the US Constitution when it comes to governing the nation. President Biden’s proposed “billionaire minimum income tax” not only thumbs its nose at the Constitution (courtesy of the 16th Amendment) but also proves that far-Left fascist Democrats have no issue preying on the public’s emotions to achieve their “transformative change.”

Biden insists that his "billionaire minimum income tax" would force the uber-wealthy to pay their "fair share," calling it critical to the deficit reduction called for in his $5.8 trillion budget request for the fiscal year 2023.

Biden’s proposal would impose a 20 percent minimum tax on households with a net worth of more than $100 million. Reaching that calculated threshold would include valuating unrealized capital gains or theoretical wealth instead of tangible wealth.

The White House projects the tax would raise roughly $360 billion over a decade from 20,000-odd people, specifically citing people like Tesla's Elon Musk and Amazon's Jeff Bezos.

Biden's proposed wealth tax – which is different from an income tax, would not only create a mountain of headaches for the IRS (read: assessment, subjectivity) but would almost assuredly be challenged in the Supreme Court as unconstitutional.

"The constitutionality of taxing wealth is largely untested," Tax Policy Center senior fellow Steve Rosenthal said, indicating that the US Supreme Court would most likely view the tax as a tax on property; a direct tax, not a tax on income.

Chris Edwards, the Tax Policy Studies Director at the Cato Institute (a Libertarian NGO) added that expected income doesn’t always materialize.

“Unrealized gain is not income,” Edwards said. “It represents the expectation of future income, which would be taxed in the future under a well-designed tax system. Often, expected future income doesn’t materialize and asset values drop."

The Bipartisan Policy Center's vice president and chief economist, Jason Fichtner, highlighted the unavoidable fact that the idea of "fair" is subjective and fails to reflect how the top 1 percent of federal tax filers are paying about 25 percent of all federal income taxes.

"They don't have 25 percent of the income, they have less than 20 percent," Fichtner said. "It's something that, for Democrats, they can rally behind and try to point to an enemy out there that's not really an enemy."

Despite not closing the door on the idea completely, US Sen. Joe Manchin (D-WV), said he has reservations about taxing capital gains or “things you don’t have."

Why This Is Important

Biden’s proposed tax would allow the federal government to require billionaires – for now – to pay taxes on assets they already own and, in almost every case, on which they have already paid taxes. The key phrase here is “unrealized capital gains” or, put plainly, wealth that hasn’t been realized yet; wealth that is on paper instead of in the pocket.

For example, let’s say a billionaire owns a mansion and the land that mansion is on. And let’s say that because the real estate market and the economy have forced the worth of that land and that mansion – two assets the billionaire has already paid for and already paid taxes on – to skyrocket. Under the Biden “billionaire minimum income tax” the billionaire would have to pay tax on the amount the building and the land have increased, even without selling it. No income was received because no sale ever occurred, yet this tax scheme would categorize that rise in worth as an “unrealized capital gain.”

Now let’s skip a decade or two into the future when the spendthrift federal government would, no doubt, figure out a way to inflict this ridiculousness onto millionaires, and then onto the Middle Class. Is it “fair” to make someone living paycheck to paycheck or with minimal savings in the bank (and most likely because of the destructive economic policies of the federal government) to pay taxes on “unrealized capital gains” because his property value increased?

Additionally, if we are all to be equal under the law, how can we tolerate the targeting of one class of individuals for different treatment? Our current “progressive” tax system (and it is called that for a good reason) does just that.

The authority to tax is issued to the federal government in the US Constitution via Article I, Section 2:

“Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three-fifths of all other Persons...”

It is further defined in Article I, Section 9:

“No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or enumeration herein before directed to be taken...”

During the Wilson administration Article I, Section 9 – which called for equal taxation under the law – was crippled by the passage of the 16th Amendment, which reads:

“The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”

The 16th Amendment obliterated equal protection under the law, ushering in the ability for the federal government to offer favors to their preferred special interests while carving out specific demographics to serve as beasts of burden for their spending addiction; an addiction that continues to this day and which has exploded beyond control.

The current system of taxation in the United States is unsustainable. In an economy where the dollar is being devalued at a rapid rate, courtesy of over 40 years of negligent and atrocious economic policies – and given the federal government's addiction to spending and their ignorance of the need for fiscal responsibility, soon the taxman will be demanding that we cede incredible percentages of our earnings to the federal government under the insanity that it is a “fair share.”

Many would argue that if our nation was called on, today, to satisfy its national debt – which as of this writing stands at $30.3 trillion (that’s $242,000-plus for each taxpayer) this situation would already be upon us.

The strong point of the United States and its people is that we are a consumer nation; we buy things. That is one reason that when we are economically independent; when we rely on our own productivity and our own resources, we not only survive, we thrive. We buy things.

But when government – at any level – starts to hobble our ability to consume; starts crippling our ability to buy things, they begin to kill the golden goose. Put another way, when the government – and especially the federal government – over-taxes so that it can spend, it kills the economic engine that allows it to tax. And when that happens economies collapse and countries die.

You’ve heard me talk and read my thoughts on the dangers of the World Economic Forum’s Great Reset and how I believe (and the evidence bears me out) the transformative, fascist Left in the United States – who are now seated in the White House for a second time this century and who now control the Democrat Party – is acting as a puppet to affect the achievement of this hostile takeover of the global economic system.

What better way to cede the economic system of the United States; what better way to forfeit the sovereignty of the American people than to eliminate wealth through the enigmatic idea of taxing “unrealized” income; “unrealized capital gains”?

Our federal government is out of control and their ability to manipulate the tax codes as they do – taxing “unrealized” wealth being a chief example – only feeds this lethal depravity. It is time that we eliminated the income tax completely and established a limited, hard-to-expand, unlayered tax on our strengths, i.e. trade and consumption, making damn sure that double-taxation is a crime.

As Thomas Jefferson said so pointedly: