On September 4 Lily Batchelder discussed ways to raise more tax revenue from the wealthy in her inaugural lecture for the new chair that she now holds as Robert C. Kopple Family Professor of Taxation. Outlining the pros and cons of higher income tax rates, increased taxation of capital gains, a wealth tax, and a financial transactions tax, Batchelder touched on several ideas that are already being advanced by Democratic candidates in the 2020 race for the presidency.
A gift from Robert Kopple LLM ’68 established the professorship. Co-founder of Los Angeles’s Kopple & Klinger, he specializes in estate planning, taxation, and business law. Kopple has written and lectured on taxation for many journals and educational institutes, including the Journal of Taxation, Taxes Magazine, the New York University Tax Institute and the University of Southern California Tax Institute, among others. Involved for more than 40 years in real estate investment and development, Kopple has also been active in venture capital funding in a variety of sectors.
Batchelder served as deputy director of the White House National Economic Council and deputy assistant to the president under President Barack Obama from 2014 to 2015. Previously, from 2010 to 2014, she was majority chief tax counsel for the US Senate Committee on Finance. Her research focuses on federal income taxes, wealth transfer taxes, and social insurance.
In her remarks, laying out a case for increasing taxes on the wealthy, Batchelder pointed out that the United States stands out among high-income countries for pronounced income inequality and low intergenerational economic mobility.
“The economic disparities between individuals reflect the luck of their birth and not hard work to an especially large extent in the US,” she said, “and one way that we can try to address this is through more progressive fiscal policy—that is, through raising more revenues, potentially from the wealthy, and using the funds to invest more in folks who are less privileged.”
Batchelder discussed a range of potential reforms, weighing their advantages and disadvantages. Summing up, she suggested a blended approach. “I don’t think we should just raise ordinary tax rates dramatically without also considering the taxation of capital gains,” she said, with those gains based upon an asset’s value over a period rather than at time of sale. A wealth tax, she noted, could raise significant revenue, though valuation of illiquid assets might be difficult. She also argued that taxing financial transactions should be given consideration. “There’s no magic bullet,” Batchelder said.
Posted September 10, 2019