Speaking before the World Economic Forum in Davos Switzerland on Wednesday, Dell CEO Michael Dell rejected Rep. Alexandria Ocasio-Cortez’s (D-NY) proposed 70 percent tax rate on earnings above $10 million.
“I’m not supportive of it,” Dell replied when asked about the freshman congresswoman’s tax plan, adding that he doesn’t believe it will “help the growth of the U.S. economy.”
Earlier Wednesday, Ray Dalio, founder of the world’s largest hedge fund, poured cold water on the proposal at Davos, warning that it could have a negative impact on the economy. “How tax rates are changed will have a huge effect on incentives and could have a huge effect on capital flows, and that will have big effects on markets and economies,” the Bridgewater boss told CNBC “It’s going to be a bigger market-influencing issue than people now realize.”.
“If we’re to have a 70 percent marginal tax rate, most individuals affected by it will calculate whether they should instead operate as a corporation in order try to convert ordinary income to capital gains, so I wonder how that will be handled,” he continued. “And I wonder what will be done to influence whether capital will leave the country.”
In a January 4 interview with Anderson Cooper for CBS’s 60 Minutes, Ocasio-Cortez floated the hefty tax rate to fund a nationwide shift to non-combustible energy sources called the “Green New Deal.” Analysis of this tax scheme estimates it would pay for less than 10% of the program’s required costs annually.
“You know, you look at our tax rates back in the ‘60s, and when you have a progressive tax rate system, your tax rate, you know, let’s say from 0 to $75,000 maybe 10 percent or 15 percent, et cetera,” she told Cooper. “But once you get to like the tippy tops, on your 10 millionth dollar, sometimes you see tax rates as high as 60 percent or 70 percent, that doesn’t mean all $10 million are taxed at an extremely high rate, but it means that as you climb up this ladder, you should be contributing more.”