It’s an election year, and that means one thing: Rich people having meltdowns about politicians suggesting the wealthy and corporations should be taxed more, and pretending to be cash-strapped victims of governmental excess in the process.
The announcement of Democratic presidential candidate Kamala Harris’s tax plan has been no exception, eliciting all sorts of bellyaching from the wealthy — as well as many of those who aren’t and likely never will be wealthy but deeply admire those who are.
One complaint in particular from Barstool Sports founder Dave Portnoy, has gone very viral, and his take is emblematic of both how poorly understood tax rates are as well as the dishonesty with which the issue is so frequently discussed in our country.
Portney claimed to spend 50% of his income on taxes after Harris said the wealthy should ‘pay their fair share.’
Portnoy is the founder of the wildly popular Barstool Sports media empire and has frequently espoused conservative political views, endorsing Donald Trump in the 2016 and 2020 elections — though he has been outspoken in recent years about Trump being too radically right-wing, especially with respect to the Supreme Court and social issues like reproductive freedom.
Be that as it may, his views on taxation seem to definitely hew to the conservative side of things. And Kamala Harris’ recent appearance on CBS’s “60 Minutes,” in which she vowed to cut taxes for the middle and working class and raise them on the wealthy, certainly seems not to have sat well with Portnoy.
“Real talk. Am I getting screwed on taxes?” Portnoy, reportedly worth $150 millionasked in reference to Harris’s plan. “I pay 50% of everything I make to the government. Is Kamala saying teachers, nurses and firefighters pay more than 50%? I’ve asked my accountants for this super wealthy tax break and they can’t seem to find it.”
Portnoy’s complaint has struck many as either incompetent, disingenuous, or perhaps a bit of both, because his claims are not remotely likely to be true even under our current tax system, which is more 1%-friendly than Harris’ proposals.
Kamala Harris’s tax plan proposes tax hikes over 10 years that only apply to those making more than $400,000 a year.
First, a few details about Harris’s tax planwhich is routinely misrepresented in the news and on social media. The short version is this: Unless you’re already rich, your taxes will not go up. But Harris’s proposed expansions of the child tax and earned income tax credits, as well as home buying and small business incentives, may make them go down.
What will go up is taxes on corporations and the wealthy in an effort to address the inequalities created by the 2017 Trump tax cuts and the budget deficit it helped create. Those cuts gave corporations and the wealthy major tax breaks funded by increases on middle- and low-income Americans (if your annual tax refund drastically reduced or disappeared in recent years, that’s likely why).
Harris’s plan ups the corporate tax rate from 21% to 28%, taxes on corporate stock buybacks from 1% to 4%, and the minimum tax on corporations from 15% to 21%. These are all intended to cut into corporations’ practice of using tax deductions and credits to drastically reduce or eliminate their tax liabilities entirely.
For regular Americans who aren’t corporations, Harris’s plan raises the top tax rate to 39.6%, which only applies to people making more than roughly $600,000 a year, and Medicare taxes to 5% for people making more than $400,000 a year. Investment income for those making more than $1 million a year would also be taxed at regular income tax rates rather than much lower capital gains rates.
Most controversial has been Harris’s plan to tax “unrealized capital gains” — taxing income, businesses, and investments whether they make any money or not — which has infuriated many people who either haven’t noticed or are purposefully omitting the fact the plan only applies to those worth $100 million or more.
If you are part of that lucky, and vanishingly tiny, sliver of rich people, you’ll also have to pay at least 25% in tax on your income and any gains your investments make. These measures are meant to target billionaires and others among the wealthiest in the country, like Dave Portnoy, who stand to benefit most from Donald Trump’s proposed tax planwhich would hand $5 billion worth of tax cuts mostly to people making over $450,000 a year — and increase the national deficit by more than twice what Harris’s would in the process, according to economists.
Portnoy’s claim that he’s paying 50% in taxes is disingenuous at best.
It’s not exactly surprising that Portnoy doesn’t like Harris’s tax plan — he is precisely the type of person her income tax plans are meant to impact. But his claim that he’s already being taxed to the hilt doesn’t hold much water.
The current top marginal tax rate is 37%which only applies to income above $578,126 in 2023 and $609,350 in 2024. And while it’s theoretically possible that Portnoy’s effective tax rate — the sum of all the income taxes he’s had to pay from all the different tax brackets below 37% — could add up to 50% of his yearly income, it’s highly unlikely.
For starters, there is an entire industry of accountants and money managers whose sole job is to help rich people drastically lower their income, business, and investment tax liabilities.
If Uncle Sam is actually coming into Portnoy’s bank account and hacking his cash in half with a big, mean knife like he’d have you believe, he needs to fire his accountants ASAP — because they’re either incompetent or scamming him. It’s also notable that Portnoy lives in Florida, which has no income tax whatsoever.
And Harris’s proposed tax rates are nowhere near the highest America has ever had anyway. During the 1950s, the era Republicans love to herald as America’s supposed heyday, the likes of Portnoy would have found himself subjected to a 90% marginal tax rate under President Dwight Eisenhower — a Republican, by the way — and a 52% corporate tax rate for his companies.
Have you ever noticed that conservatives always glowingly and lovingly talk about tax-slashing Ronald Reagan but never so much as mention Eisenhower, the man literally responsible for their favorite bygone decade’s unprecedented prosperity? Probably not a coincidence.
Portnoy’s tweet may be a convenient way to stoke anger about taxes by implying he’s just as frustrated by them as we normal people are, but the very notion is preposterous. The Dave Portnoys of the world will still be multi-millionaires and billionaires for the rest of their lives even if Harris’s — or Eisenhower’s, for that matter — tax plan were implemented.
They’ve also had decades of low taxes that have allowed them to amass absurd fortunes — in part by ducking their comparatively paltry tax liabilities with clever accounting—while the rest of us pay through the nose and get very little in return. They’ll all be fine. Don’t fall for their propaganda.
John Sundholm is a news and entertainment writer who covers pop culture, social justice and human interest topics.
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