NEWS: Sanders, Bowman, Markey Introduce Legislation to Combat Corporate Greed and Windfall Profits

WASHINGTON, June 21 – Amid record-breaking corporate profits and unprecedented corporate greed, Sen. Bernie Sanders (I-Vt.) announced he will soon introduce legislation that would impose a 95 percent windfall tax on the excessive profits of large corporations that are using inflation as an excuse to charge the American people outrageous prices on the products they sell. Had this legislation, the Ending Corporate Greed Act, been in effect in 2023, it would have raised an estimated $300 billion in one year from ten of the largest corporations alone.

Sen. Ed Markey (D-Mass.) joined Sanders on the legislation in the Senate and Rep. Jamaal Bowman, Ed.D. (D-N.Y.) today introduced companion legislation in the House of Representatives.

This would not be the first time the United States implemented a windfall profits tax. Sanders’ legislation is modeled after the windfall profits tax implemented by the United States during the first and second World Wars and the Korean War. During World War II, the tax rate reached 95 percent, which ensured that companies could not engage in war profiteering. The U.S. also enacted a windfall profits tax on oil and gas companies as recently as the mid-1980s.

“The American people are sick and tired of being ripped-off by large corporations that continue to make record-breaking profits by charging outrageously high prices for gas, rent, food, and prescription drugs,” said Sanders. “Enough is enough. We cannot continue to allow large corporations to make obscene profits by price gouging Americans in virtually every sector of our economy. If corporate CEOs and their masters on Wall Street will not end their greed, we must end it for them. It is time for Congress to enact a windfall profits tax.”

“Since the pandemic, corporations have remained incredibly selfish in their business practices, squeezing their consumers who rely on them for essential goods and services, including gas, food, prescription drugs, banking and more,” said Bowman. “As corporations continue to make massive profits off the backs of rank-and-file workers, wages aren’t keeping pace. As a result the American people are struggling to keep up with the rising costs of living. Congress must do its part to check corporate greed before it completely robs people in America of their ability to live a life in pursuit of liberty, justice and happiness. As billionaires and corporations continue to get richer while the average person struggles to afford gas, food and utility costs–we must begin to hold those responsible to account and take the necessary steps to build an economy that works for everyone, not just the wealthy few.”

“Corporate greed and unconscionable price gouging have resulted in Americans paying more for basic necessities such as gas and groceries,” said Markey. “The Ending Corporate Greed Act penalizes large corporations raking in record profits while everyday Americans and workers pay the price.”

Last year, corporate profits hit a record high with a reported profit of $2.8 trillion after taxes. Today, corporate profit margins are at their highest rate since the 1950s. Meanwhile, rising prices have continued to sap workers’ paychecks with inflation hitting 4.1 percent last year – with corporate profits driving more than half of the rise in inflation during the second and third quarters of 2023. Americans have taken notice of this greed – a recent poll showed that 84 percent of all respondents said they believe “corporations being greedy and raising prices to make record profits” is a major driver of inflation.

If signed into law, Sanders’ Ending Corporate Greed Act would:

• Maintain the existing 21 percent corporate tax on a company’s profit equal to or less than pre-pandemic levels.
• Establish a 95 percent windfall profits tax on a company’s profits that are in excess of their average profit level from 2015-2019, adjusted for inflation.
• Apply only to large companies with $500 million or more in revenue annually.
• Be limited to 75 percent of income in the current year.
• Be a temporary emergency measure, applying only in 2024, 2025, and 2026.

Under this legislation, even with the 95 percent windfall profits tax, companies would still be able to make a reasonable profit compared to previous years. Additionally, as the tax is on profit, not revenue, companies that raise prices for legitimate reasons related to rising expenses would not be penalized. However, companies that have chosen to raise prices in the pursuit of obscene profiteering, to further enrich their CEOs and wealthy shareholders, would pay a tax of up to 95 percent on their windfall profits. For example:

• Chevron’s average profit between 2015-2019 was $7.6 billion. But its 2023 profit was $29.6 billion, a 289 percent increase. If the windfall profits tax had been in place in 2023, it would have paid an additional $19.1 billion in taxes and still would have maintained $10.5 billion in profits.
• Amazon’s average profit between 2015-2019 was $6.9 billion. But its 2023 profit was $37.6 billion, a 444 percent increase. If the windfall profits tax had been in place in 2023, it would have paid an additional $27.6 billion in taxes and still would have maintained $10 billion in profits.
• JP Morgan Chase’s average profit between 2015-2019 was $37.4 billion. But its 2023 profit was $61.6 billion, a 65 percent increase. If the windfall profits tax had been in place in 2023, it would have paid an additional $14 billion in taxes and still would have maintained $47.6 billion in profits.
• Berkshire Hathaway’s average profit between 2015-2019 was $39.8 billion. But its 2023 profit was $120.2 billion, a 202 percent increase. If the windfall profits tax had been in place in 2023, it would have paid an additional $67.1 billion in taxes and still would have maintained $53.1 billion in profits.

Read the summary, here.
Read the fact sheet, here.
Read the bill text, here.