Some states are reviving a push to tax the rich

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Some states are reviving a push to tax the rich

2026-03-12 00:36 Last Updated At：00:41

PROVIDENCE, R.I. (AP) — Chuck Collins figures he won life’s lottery by inheriting vast sums of money through his great-grandfather Oscar Mayer’s processed meat company, but rather than fight to protect every dime Collins has helped push to hike taxes on the ultrarich like himself.

He was successful in helping implement a higher tax in Massachusetts on income over $1 million, and the idea has already taken hold in a handful of other blue states, including California, Maryland, Minnesota and New Jersey. Lawmakers in the state of Washington, which doesn't have an income tax, could send the governor this week a measure that would impose one on million-dollar earners.

“I think people are waking up to the harms of these inequalities,” said Collins, a founding member of the group Patriotic Millionaires, which calls for higher taxes on the country’s super affluent. “Including people who have wealth, who say, if we keep going down this road, it ain’t going to end well for anybody.”

Since a state Supreme Court decision nearly a century ago shot down an income tax, Washington has stood out as being one of few states controlled by Democrats without a tax on wages or salaries — though it does tax certain investment proceeds.

Facing a budget shortage, lawmakers are debating a proposal that would create a nearly 10% annual tax on personal earnings over $1 million. If adopted, the tax would collect billions of dollars of new revenue that would be designed to pay for free K-12 school meals, childcare services, a family tax credit and eliminate sales taxes on personal care items such as shampoo.

The state House adopted it this week after an all-night session deliberating amendments to the proposal. Now, it goes back to the Senate, which passed a version previously. Democratic Gov. Bob Ferguson has indicated support if the Legislature, which is controlled by his party, can send it to him before it adjourns Thursday.

“Washington is a state that has had an extremely regressive tax structure for 93 years,” House Majority Leader Joe Fitzgibbon, a Democrat, said in an interview. “It falls very heavily on working and middle class people in our state.” He said that if the change is adopted, it will help. “We don’t need to be a tax haven,” he said.

Others, including GOP lawmakers, caution that taxes on the wealthy are not a comprehensive solution to addressing worrisome state revenues and can drive away businesses.

Colin Hathaway, a millionaire businessman in Washington, said he's concerned the proposed tax would treat the money earned by his roofing company as income, even though he's putting most of it back into the business. He was already hit by the state's previous move to hike capital gains taxes, and said an additional tax could force him to move way from the state where his high school-aged children grew up.

“There’s a strong incentive to not be doing business here,” he said.

If the measure is adopted, it's likely to be challenged in court and with a ballot measure.

With affordability a hot topic in statehouses this session, a handful of progressive states are at least considering some kind of wealth tax.

Perhaps the most ambitious tax-the-rich effort is taking place in California – a state that already taxes its millionaire class. Advocates are working on a ballot measure that would place a one-time 5% tax on the assets of those with a $1 billion net worth. The proposal, backed by a large health care union, would use the extra revenue to backfill federal funding cuts to health services for lower-income people that were signed by President Donald Trump last year.

For critics, the wealth tax effort in California is the latest example of how the push to tax the rich in the U.S. is no longer about finding solutions to raise revenue but instead now backed by those who believe excessive wealth should be reduced or even erased, said Jared Walczak, a senior fellow at the Tax Foundation.

“You see that in the language around something like the California wealth tax, where the ballot language itself talks about it being a tax on sustaining excessive accumulations of wealth,” Walczak said.

Elsewhere, Rhode Island legislators are debating a budget proposal – backed by Democratic Gov. Dan McKee – that would enact higher taxes on residents earning $1 million or more.

In Michigan, organizers are working to collect enough signatures to get a ballot initiative in front of voters in November asking them to approve replacing the state’s current flat tax. Under the proposal, Michigan would place an additional 5% tax on those who make over $500,000 individually or $1 million for joint filers. The initiative, which is backed by the state’s board of education, would direct the new revenue to help fund K-12 schools.

And New York City Mayor Zohran Mamdani has reupped his push for New York state to raise taxes on the rich — though he faces opposition from Democratic Gov. Kathy Hochul. A similar call has been made by Chicago Mayor Brandon Johnson, but the Illinois Statehouse so far has not moved on imposing a millionaire tax.

The recent push by left-leaning leaders in blue states contrasts with what's being done in many Republican-led states, which have been more critical of passing higher taxes on their richest residents and have moved to abolish or significantly reduce personal income taxes.

Eight states have no income tax at all, and Walczak said the gap between states seeking tax relief and those seeking higher taxes on the wealthy “is larger than it has been for decades.”

Still, questions remain about whether such cuts result in spiking other taxes or eliminating funding for services.

“I think most Americans are pretty fed up because I think they understand that there’s really two tax systems. There’s one for your average person. You’re a nurse? You’re firefighter? Every two weeks you pay taxes. And then for the super wealthy, there’s all these tax breaks and all these special loopholes,” said David Kass, executive director of the left-leaning advocacy group Americans for Tax Fairness.

Massachusetts is often brought up in the debate over the effectiveness of millionaire taxes. Voters passed the Fair Share Amendment in 2022, which added a 4% surtax on income over $1 million; the threshold has risen annually for inflation. To date, the amendment has collected $6 billion for education and transportation, according to the state’s Executive Office for Administration and Finance.

“It’s good for everybody, in a time of grotesque inequality, for wealthy people to chip in a little bit more,” said Collins, Oscar Mayer's great-grandson. “Especially at a time when others are just struggling to keep up.”

Attanasio reported from Seattle and Mulvihill from Haddonfield, New Jersey.

Iran targets ships, Dubai airport and oil facilities as economic concerns mount

DUBAI, United Arab Emirates (AP) — Iran attacked commercial ships on Wednesday and targeted Dubai International Airport, escalating a campaign of bottling up the oil-rich Persian Gulf as global energy concerns mounted and American and Israeli airstrikes pounded the Islamic Republic.

Iran's response to the surprise Israeli and U.S. bombardment 12 days ago has upended trade routes, choked supplies of fuel and fertilizer coming out of the Gulf and threatened air traffic through one of the world's most-traveled regions. Both sides have dug in, hoping to outlast the other.

An Israeli intelligence assessment found that Iran's new supreme leader, Ayatollah Mojtaba Khamenei, was wounded at the start of the war — on the day when his father and predecessor, Ayatollah Ali Khamenei, was killed in an Israeli airstrike.

An Israeli intelligence official and a reservist with knowledge of the assessment spoke on condition of anonymity because they were not authorized to discuss the matter with the media. They gave no details on the nature of the injuries.

The 56-year-old, whose wife was also killed in the Israeli strike, has not been seen since becoming supreme leader on Monday. Yousef Pezeshkian, the son of Iranian President Masoud Pezeshkian, wrote on social media that he had heard Mojtaba was wounded but that friends said “he is healthy and there is no problem.”

The fallout across the Middle East has widened as Israel strikes what it says are targets connected to Iran-backed Hezbollah militants in Lebanon. The U.N. refugee agency said at least 759,000 people have been internally displaced in Lebanon, while more than 92,000 others have crossed into neighboring Syria.

In a separate development, Iran’s sports minister said it cannot take part in the upcoming soccer World Cup in North America in June because of the “wicked acts” of the United States. Ahmad Donyamali told Iranian state TV that “it’s not possible for us to take part in the World Cup” after the U.S. launched two wars against Iran in less than a year. He said Iranian players would not be safe in the United States.

Two Iranian drones hit near the Dubai airport, home to the long-haul carrier Emirates and the world’s busiest for international travel. Four people were wounded but flights continued, the Dubai Media Office said.

A projectile hit a Thai cargo ship off the coast of Oman in the Strait of Hormuz, setting it ablaze. Authorities are searching for three missing crew members from the Mayuree Naree after 20 were rescued by the Omani navy, according to Thailand’s Marine Department.

At least 12 incidents have been confirmed involving vessels in and around the Strait of Hormuz, through which a fifth of all traded oil passes, since the war began, according to two global trackers. The International Maritime Organization says at least seven mariners have been killed.

Iran has effectively stopped cargo traffic through the narrow strait. It has also targeted oil fields and refineries in Gulf Arab nations, aiming at generating enough global economic pain to pressure the United States and Israel to end their strikes.

The United States has pledged to keep the strait open and has carried out intense airstrikes targeting Iran's navy and the port city of Bandar Abbas.

The U.S. military said Tuesday it had destroyed 16 Iranian minelayers near the strait, though U.S. President Donald Trump said in social media posts that there were no reports yet of Iran mining the passage.

Some tankers, believed linked to Iran, are continuing to get through the strait, making so-called “dark” transits -- meaning they aren’t turning on trackers that show where they are. Vessels carrying sanctioned Iranian crude often turn off their trackers.

The commodity-tracking firm Kpler said Iran has restarted crude exports through its Jask oil terminal on the Gulf of Oman. A tanker loaded roughly 2 million barrels at Jask on March 7, it said.

Oil prices remained well below Monday’s peaks but the price of Brent crude, the international standard, was still up some 20% Wednesday from when the war began. Consumers around the world are already feeling the pain at the pump.

The International Energy Agency agreed Wednesday to release the largest volume of emergency oil reserves in its history, in a bid to counter the war’s impact on energy markets.

The Paris-based organization said it will make 400 million barrels of oil available from its member countries’ emergency reserves, more than twice the amount they released four years ago in response to Russia’s invasion of Ukraine.

Israeli strikes set a building ablaze in central Beirut, engulfing the top two floors. Lebanon’s Health Ministry said four people were wounded.

Other Israeli strikes on southern and eastern Lebanon killed 14 people, and a Red Cross worker also died Wednesday of wounds sustained Monday, when his team was hit by an Israeli strike while they were rescuing people from an earlier attack.

Lebanon's Health Ministry said Wednesday that 570 people have been killed in the country since the latest fighting began.

Iranian authorities say more than 1,300 people have been killed there, and Israel has reported 12 people dead. The U.S. has lost seven soldiers while another eight have suffered severe injuries.

Iran’s joint military command said it would start targeting banks and financial institutions in the Middle East. That would put at risk particularly Dubai, in the United Arab Emirates, which is home to many international financial institutions, as well as Saudi Arabia and the island kingdom of Bahrain.

The threat came after a Tehran location of Bank Sepah, a state-owned financial institution sanctioned by the U.S. over funding its armed forces, came under attack Wednesday, killing staffers there, according to the state-run IRNA news agency.

This story has been corrected to fix an earlier misspelling of Mojtaba Khamenei’s first name.

Mednick reported from Tel Aviv, Israel and Rising from Bangkok. Associated Press writers Samy Magdy in Cairo, Sally Abou AIJoud in Beirut, Giovanna Dell’Orto in Miami, Jamey Keaten in Geneva, Cara Anna in Lowville, New York, Kirsten Grieshaber in Berlin and Samuel Petrequin in Paris contributed to this story.