These Illinois Billionaires Could Pay 20% More Under Biden Plan

Illinois — Billionaire Ken Griffin and other wealthy Illinois residents could pay 20 percent more in taxes under a “Billionaire Minimum Tax” proposed in President Joe Biden’s fiscal year 2023 budget proposal.

The Biden administration is asking Congress to approve the proposal, part of its efforts to reduce the federal deficit over the next decade while at the same time funding new spending. The proposed tax on the ultra-wealthy would affect fewer than 1 percent of Americans, but “eliminates the inefficient sheltering of income for decades or generations,” the White House said Monday at a news conference.

Under the proposal, households worth more than $100 million would pay at least 20 percent in taxes on both income and “unrealized gains,” or the increase in an unsold investment’s value. Many wealthy people hold onto these investments for decades, meaning they’re never taxed, the administration said.

The tax would apply only to the top one-hundredth of 1 percent of Americans, Biden said at a news conference, but would raise “$360 billion that can be used to lower costs for families and cut the deficit.”

Among those likely affected would be the following Illinois residents with a place on the Forbes’ Real-Time Billionaires ranking (listed net worths are according to Forbes as of the close of business Monday):

• Hedge fund billionaire Ken Griffin — $28.3 B
• Insurance magnate Patrick Ryan — $8.1 B
• Real estate tycoon Neil Bluhm — $5.5 B
• Investment banker Joe Mansueto — $6 B
• Professional investor Sam Zell — $5.9 B
• Hotelier and heir to family fortune Thomas Pritzker — $5.2 B
• Toy maker Ty Warner, of Beanie Babies fame —$4.8 B
• Financier Mark Walter — $4.5 B
• Groupon co-founder Eric Lefkofsky — $4.1 B
• Paylocity founder Steven Sarowitz — $3 B
• Governor and heir to family fortune J.B. Pritzker — $3.6 B
• Former commerce secretary and family fortune heiress Penny Pritzker — $3.2 B
• Koch Foods CEO Joseph Grendys — $3.2 B
• Meat processing magnate Sheldon Lavin, $3 B
• Hotelier and heir to family fortune Jennifer Pritzker, $2 B
• Sports team magnate Jerry Reinsdorf, $1.8 B
• Cryptocurrency startup co-founder Matthew Roszak, $1.8 B
• Investor Carl Thoma, $1.6 B
• Private equity entrepreneur Justin Ishbia, $1.5 B
• Electric power entrepreneur Michael Polsky, $1.5 B
• Online retail entrepreneur and investment management president Michael Krasny, $1.3 B

“Now, I’m a capitalist, but … if you make a billion bucks, great,” Biden said. “Just pay your fair share. Pay a little bit.

“A firefighter and a teacher pay more than double — double the tax rate that a billionaire pays. That’s not right. That’s not fair.”

The proposed policy is “extremely nuanced,” according to an Associated Press explainer. It would allow wealthy households to spread some payments of their unrealized gains over nine years, and for five years on new income going forward. In effect, the AP explained, the payments are a prepayment on tax obligations they will owe when the investments are sold.

The proposal could be met with resistance by moderate Democrats, including Sens. Joe Manchin of West Virginia and Krysten Sinema of Arizona, but it gives Democrats a talking point as inflation reaches a 40-year high. At the same time, for Republicans who oppose it, it creates a political liability of appearing to side with multibillionaires.

Richest Illinoisan Griffin — who ranks at No. 51 on Forbes' real-time list of billionaires and was No. 47 on the Forbes 400 — has been a vocal critic of Illinois' Democrat governor and fellow billionaire J.B. Pritzker.

The Citadel CEO has said he will go "all in" to defeat Pritkzer and get a Republican governor elected. He's since donated $20 million to the campaign of Aurora Mayor Richard Irvin, who is one of 10 Republicans running in the June primary for the governor's race.

Last year, ProPublica published a bombshell report based on unreleased IRS files that showed multibillionaires Jeff Bezos, Elon Musk, Mark Zuckerberg and Rupert Murdoch paid very little or sometimes nothing at all in income taxes.

The Associated Press contributed reporting.