Lawmakers are advancing proposals to tax the net worth of individuals with assets exceeding $50 million, aiming to generate $10 billion annually by 2030. Early data suggests high-net-worth individuals may relocate to avoid taxation, raising concerns about capital flight.
- Proposed wealth tax targets net worth above $50 million with a 2% rate and 5% for fortunes over $1 billion
- $10 billion annual revenue target by 2030 under current estimates
- 12,700 high-net-worth individuals altered residency or declared foreign assets between 2020–2025
- 40% of those moved to low-wealth-tax jurisdictions like the Cayman Islands or Monaco
- Projected 3% drop in private equity inflows if legislation enacted without global alignment
- Stocks in luxury and private aviation sectors rose 4.8% and 6.2% in January 2026
The debate over wealth taxation in the United States has gained momentum in early 2026, as bipartisan policy discussions focus on implementing a federal net worth levy targeting households with assets surpassing $50 million. The proposed legislation would impose a 2% annual tax on net worth above that threshold and a 5% rate for fortunes exceeding $1 billion. Proponents argue the measure could yield up to $10 billion per year in new revenue by 2030, funding infrastructure and climate initiatives. Data from Treasury Department analyses indicate that between 2020 and 2025, an estimated 12,700 individuals with net worths above $100 million filed foreign asset declarations or changed residency status, suggesting potential behavioral responses to looming tax changes. Of those, nearly 40% were identified as having moved to jurisdictions with no or low wealth taxes, including the Cayman Islands, Monaco, and certain Gulf states. The proposed tax structure would apply only to households with annual income over $2 million, ensuring broader coverage while avoiding lower-tier impacts. Critics warn that such policies could trigger capital outflows, particularly in tech and finance hubs like San Francisco, New York, and Miami, where a significant concentration of ultra-high-net-worth individuals resides. Analysts project a possible 3% decline in private equity fund inflows if legislation passes without international coordination. Market reactions have been mixed: stocks in luxury goods and private aviation sectors rose 4.8% and 6.2% respectively in January 2026, reflecting investor anticipation of relocation-related spending. Conversely, real estate in coastal cities showed a 2.1% dip in transaction volume, signaling cautious behavior among high-income buyers.