Democratic presidential candidate Elizabeth Warren released her vision for funding the Medicare-for-All plan, and without surprise, it includes tough taxes on the wealthiest individuals and companies in the country. However, it added one surprise: a transaction fee for financial securities that could have a consequence on the middle class.
Warren is proposing a 10-basis point tax on the sale of bonds, stocks, and derivatives to raise approximately $800 billion over the next 10 years—part of her effort to foot the total $13.5 trillion-$34 trillion bill for providing insurance to every American. The American Retirement Association (ARA) was quick to point out that the tax would have a substantial impact on 401(k)s, IRAs, and pension plans of middle-class Americans.
If enacted, the ARA asserts that “American workers will have to work 2.5 years longer to make up for the lost retirement savings due to this new tax,” in a statement responding to the plan. The organization also claims that the tax would siphon off $64,200 over a 40-year lifetime savings in 401(k)s and IRAs.
Warren joins Sens. Kamala Harris and Bernie Sanders in pitching fees on financial securities transactions to fund their respective Medicare-for-All plans.
Warren also proposed a systemic “annual [risk] fee that would be imposed on bank holding companies and nonbank financial companies…of 0.15% of firms’ covered liabilities defined primarily as total liabilities less deposits insured by the FDIC.”
That measure would be expected to generate approximately $100 billion between 2020-2029.
Warren also plans to repeal the Tax Cuts and Jobs Act of 2017, which would contribute $2.9 trillion in revenue in the next decade. She also wants to impose additional taxes on the highest 1% of income for individuals to raise a total of $3 trillion over the next decade. These, among other sources of revenue, are expected to provide a total of $20.5 trillion in federal funding for Medical for All between 2020 and 2029, “without imposing any new taxes on middle-class families,” Warren’s organization said in a statement.