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Sen. Elizabeth Warren lauds Biden billionaires’ tax, calls for even more CEO pay changes

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Reuters| Pool | Reuters

Sen. Elizabeth WarrenOn Tuesday, the Biden administration was praised for its renewed efforts to create a tax on America’s most wealthy households. They also called for more changes in the compensation of corporate executives.

Warren, a Democrat, from Massachusetts stated that President Joe Biden’s proposal to require the top 0.01% of households — those worth over $100 million — to pay a 20% tax on their income is a welcome reform for a “broken” tax system.

Warren said to “Squawk Box” that Democrats believe they have a plan to tax billionaires and millionaires. Warren explained, “Squawk Box,” “What Democrats mean is that we’ve got an idea to increase taxes on these people.”

According to her, higher taxes on American’s wealthiest households could help finance future subsidies for corporations like tax credits in clean energy projects, as well as large-ticket government projects, such as President Obama’s infrastructure bill.

Warren quoted TeslaThe CEO Elon MuskAs an example, a company and its executive can reap the benefits from public support.

The former president of the United States was elected President in 2009. Barack ObamaTo encourage electric car production, the government provided $2.4 billion of funding. To offset the higher sticker prices of manufacturers, the government began offering car buyers a $7,500 credit as part this program.

Tesla customers have since lost the tax credit that Tesla automakers received for first 200,000 EVs. However, many analysts feel that this program helped Tesla grow in its early years.

Warren stated, “I am happy to celebrate success.” But let’s not forget that Elon Musk did it all by himself. He received huge investments from the taxpayers, and from the government.

Massachusetts Democrat long advocated for higher taxes on America’s wealthiest citizens.

The former bankruptcy attorney proposed an annual tax of 2% on net worth households between $50 million to $1 billion. 4% annual surtax on households worth over $1 billion.

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Her attack on corporations’ profits was also renewed by her, stating that CEOs are not entitled to stock and investors receive buybacks.

In the fifty years since its creation, the composition of executive salaries has changed significantly. Many companies now have stock options and award as a major component of their executive pay. The Economic Policy Institute is a liberal think tank that analyzes executive compensation. It shows stock options now account for about half of CEO pay.

Biden’s budget proposalThis week’s statement, which was released this week, states that President Trump supports legislation that would allow executives to hold company shares for “several,” years, and ban them from selling equity within the year following a corporate purchaseback.

Warren explained that the shift to executive pay in stock was a result of an attempt to limit what executives can be paid. The feeling was that executive compensation was out of control, and was far more than ordinary workers.

She added that “But shifting over to being paid in stock has clearly blown completely through that rationalization.” The buybacks aren’t “have executive making the right investment decision in investments” [research and development]Or on the overall care of shareholders.”

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