Referred to the House Committee on Ways and Means.
This bill adds a new subsection to IRC section 11 that increases the corporate income tax rate for C-corporations whose ratio of compensation of the CEO (or highest paid employee) to median worker pay exceeds 50 to 1. The statutory pay-ratio follows the SEC rule reference but requires a 5-year annualized average for the ratio and extends reporting rules to large private corporations with average gross receipts of $100 million or more; smaller private corporations under that threshold are exempt.
Progressives emphasize reducing inequality and uses of revenue; conservatives emphasize business competitiveness and government overreach.
Relative to its intended legislative type, this bill is a clear statutory vehicle for imposing an additional corporate tax rate layer tied to CEO/median-worker pay ratios: it specifies thresholds, calculation reference, a smoothing mechanism (5-year average), exclusions for smaller private firms, an effective date, and necessary conforming amendments, while delegating implementation details and anti-avoidance specifics to Treasury regulation.
This bill adds a new subsection to IRC section 11 that increases the corporate income tax rate for C-corporations whose ratio of compensation of the CEO (or highest paid employee) to median worker pay exceeds 50 to 1.
The statutory pay-ratio follows the SEC rule reference but requires a 5-year annualized average for the ratio and extends reporting rules to large private corporations with average gross receipts of $100 million or more; smaller private corporations under that threshold are exempt.
The corporate tax rate (base 21 percent) is increased by a sliding ‘‘penalty’’ in percentage points ranging from +0.5 points (for ratios >50–100:1) up to +5 points (for ratios greater than 500:1).
On content alone, the bill is a targeted but politically charged tax increase that would attract organized opposition from corporate and business constituencies and require complex implementation rules from Treasury. While it contains some pragmatic elements (exemptions, averaging, reliance on existing SEC framework), those features are unlikely to be sufficient to transform it into a broadly bipartisan bill. Passage is more plausible if folded into a larger compromise package with offsets or other tradeoffs, but as a standalone measure it faces long odds.
Relative to its intended legislative type, this bill is a clear statutory vehicle for imposing an additional corporate tax rate layer tied to CEO/median-worker pay ratios: it specifies thresholds, calculation reference, a smoothing mechanism (5-year average), exclusions for smaller private firms, an effective date, and necessary conforming amendments, while delegating implementation details and anti-avoidance specifics to Treasury regulation.
Progressives emphasize reducing inequality and uses of revenue; conservatives emphasize business competitiveness and government overreach.
These are examples from the analysis, not a ranked list of the most-affected groups.
Progressives emphasize reducing inequality and uses of revenue; conservatives emphasize business competitiveness and government overreach.
A mainstream progressive would likely view the bill favorably as a targeted tool to reduce extreme income inequality in large corporations and to discourage excessive executive pay.
They would emphasize the bill’s potential to incentivize companies to raise median worker pay or reduce outsized CEO compensation to avoid higher corporate taxes.
They would see the Treasury’s anti-avoidance mandate as necessary but would want strong, enforceable regulations to prevent gaming.
A moderate would see the bill as a targeted attempt to address excessive pay gaps but would be cautious about unintended economic and administrative consequences.
They would acknowledge the fairness rationale and potential revenue but worry the measure could be gamed or slightly reduce competitiveness for affected firms without producing large behavioral changes.
Centrists would want concrete estimates of revenue and economic effects, clear rules to limit avoidance, and possibly a phased or pilot implementation.
A mainstream conservative would likely oppose the bill as an unwarranted government interference in private-sector compensation and an effective corporate tax increase that harms competitiveness.
They would highlight that the policy penalizes success, increases the statutory corporate tax rate for affected firms, and could drive firms to outsource, reclassify workers as contractors, relocate, or reduce investment.
They would also view the calculation and enforcement as burdensome and prone to gaming.
Reached or meaningfully advanced
Reached or meaningfully advanced
Still ahead
Still ahead
Still ahead
On content alone, the bill is a targeted but politically charged tax increase that would attract organized opposition from corporate and business constituencies and require complex implementation rules from Treasury. While it contains some pragmatic elements (exemptions, averaging, reliance on existing SEC framework), those features are unlikely to be sufficient to transform it into a broadly bipartisan bill. Passage is more plausible if folded into a larger compromise package with offsets or other tradeoffs, but as a standalone measure it faces long odds.
The bill has not accumulated any surfaced votes yet.
Progressives emphasize reducing inequality and uses of revenue; conservatives emphasize business competitiveness and government overreach.
On content alone, the bill is a targeted but politically charged tax increase that would attract organized opposition from corporate and bu…
Relative to its intended legislative type, this bill is a clear statutory vehicle for imposing an additional corporate tax rate layer tied to CEO/median-worker pay ratios: it specifies thresholds, calculation reference,…
Go beyond the headline summary with full stakeholder mapping, legislative design analysis, passage barriers, and lens-by-lens tradeoff breakdowns.