The Constitutionality of a National Wealth Tax

Authors

Dawn Johnsen
Walter Dellinger, Duke Law SchoolFollow

Document Type

Article

Publication Date

2018

Keywords

tax law, constitutional law, national wealth tax, economic inequality

Abstract

Economic inequality threatens America’s constitutional democracy. Beyond obvious harms to our nation’s social fabric and people’s lives, soaring economic inequality translates into political inequality and corrodes democratic institutions and values. The coincident, relentless rise of money in politics exacerbates the problem. As elected officials and candidates meet skyrocketing campaign costs by devoting more and more time to political fundraising—and independent expenditures mushroom—Americans lose faith and withdraw from a system widely perceived as beholden to wealthy individuals and corporate interests.

The United States needs innovative approaches to help rebuild foundational, shared understandings of American democracy, the American Dream, and opportunity and fairness. Tax policy provides one central context in which collective judgments about fundamental values help form national identity. We believe that a national wealth tax (that is, a tax on individuals’ net worth) should be among the policy options under consideration to support vital infrastructure, social service, and other governmental functions. Although not a new concept, a wealth tax may be an idea whose time has come, as inequality soars toward record highs.

Our aim in this Essay is to help ensure that a wealth tax is among the policy options available to Congress by challenging a common assumption that has unduly harmed its prospects: the belief that the U.S. Constitution effectively makes a national wealth tax impossible. We believe this conventional wisdom is wrong and its casual repetition has been harmful. Devising a progressive tax system that effectively taxes the wealthy is notoriously difficult, but whether a wealth tax is part of that system should depend upon the policy choices of democratically elected representatives, not faulty constitutional understandings.

Citation

Dawn Johnsen & Walter Dellinger, The Constitutionality of a National Wealth Tax, 93 Indiana Law Journal 111-137 (2018)