HR-7767-119
Referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, Financial Services, and Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Sponsored by Ro Khanna (D-CA)
What it does
The "Make Billionaires Pay Their Fair Share Act" (HR 7767-119) would impose a minimum federal tax on individuals with net worth exceeding $1 billion, targeting income that currently goes untaxed because it has not been "realized" — for example, stock that has risen in value but has not been sold. The bill is currently in committee and its full mechanical details are not publicly available in the provided text, but based on the short title and category, it would likely establish a minimum effective tax rate on billionaires' total economic income, including unrealized capital gains.
Who benefits
The federal government would receive additional tax revenue. Lower- and middle-income taxpayers who supporters argue currently bear a disproportionate share of the tax burden relative to their wealth could benefit indirectly. Social programs funded by increased federal revenue could see expanded capacity. Domestic competitors of large corporations whose billionaire owners currently defer taxes indefinitely may benefit from a more level playing field.
Who is hurt
Individuals with net worth exceeding $1 billion — estimated at roughly 700–800 people in the United States — would face new or higher tax liability. Family-owned businesses, farms, or illiquid assets held by billionaires could face forced asset sales to meet tax obligations on gains that have not yet been converted to cash. Investment funds and private equity vehicles in which billionaires hold large stakes could face indirect pressure. Tax attorneys and wealth management professionals who structure deferral strategies for ultra-high-net-worth clients could see reduced demand for those services.
Supporters argue
Supporters argue that the wealthiest Americans effectively pay lower tax rates than middle-class workers because the tax code taxes wages but not unrealized investment gains, citing ProPublica's analysis showing some billionaires paid effective federal rates in the low single digits. They contend that taxing economic income — regardless of whether assets are sold — is necessary to address a structural inequity in the tax code, and that the narrow population affected (fewer than 1,000 individuals) means the burden falls on those with the greatest capacity to pay.
Opponents argue
Opponents argue that taxing unrealized gains is constitutionally suspect after Moore v. United States (2024), in which the Supreme Court explicitly declined to resolve whether the Sixteenth Amendment requires "realization" before income can be taxed — leaving the legal foundation for this bill unresolved. They further contend that valuing illiquid assets annually is administratively impractical and could force billionaires to sell businesses or farms to pay taxes on paper gains, potentially disrupting employment and investment in ways that harm workers and communities beyond the billionaires themselves.
Constitutional context
The central constitutional question is whether Congress can tax unrealized gains under the Sixteenth Amendment, which authorizes an income tax "without apportionment." In Moore v. United States (2024), the Supreme Court upheld the Mandatory Repatriation Tax but explicitly declined to decide whether realization is constitutionally required, leaving the legality of a wealth or unrealized-gains tax unresolved. If a court were to find that realization is required, such a tax could be classified as a direct tax subject to apportionment among the states by population under Article I, §2 and §9 — a requirement that would make it effectively unworkable.
Checks and balances
Congress would expand its taxing power over a new category of income (unrealized gains); the IRS would gain new enforcement authority over billionaires' asset valuations; federal courts — particularly after Moore — would serve as the primary check through constitutional review of whether the tax exceeds Congress's authority under the Sixteenth Amendment.
Historical precedent
President Biden's FY2025 budget proposed a 25% minimum tax on total income — including unrealized gains — for households worth over $100 million; it did not advance in Congress, and no comparable federal unrealized-gains tax has ever been enacted.