Introduction 

Tax Day is now behind us, marking the end of the first tax season after a conservative-led Congress pushed through a series of policy changes that skewed an already inequitable tax code further in favor of corporations and the ultra-wealthy. And we are already seeing the impact. That series of policy changes spent trillions of dollars in public funds to cut taxes for wealthy households and profitable corporations while making daily life more expensive for everyday Americans.1 A middle-income household, for example, will see its taxes go up by $900 on average, while a household in the richest one percent will see its taxes go down by nearly $9,000.2 

In response to the deepening inequality, some members of Congress are proposing legislation that would make the tax code more progressive by providing financial relief to everyday people while raising taxes on the ultra-wealthy. One bill aims to primarily benefit middle-income people. Another would tackle extreme wealth inequality by imposing a tax on billionaires while implementing a version of guaranteed income. The bills offer different visions and mechanisms for achieving the goal of a more equitable tax code. 

We can have a tax system that adequately taxes corporations and the wealthy, uses the revenue to pay for public goods[,] redresses racial inequality in our economy, and ensures economic security for all people.

Given the Republican-controlled Congress, these bills are very unlikely to pass. But these policy proposals are an opportunity to start envisioning and fighting for a tax code that equitably distributes our country’s vast resources. We can have a tax system that adequately taxes corporations and the wealthy, uses the revenue to pay for public goods (such as schools, libraries, and modernized energy and transit systems), redresses racial inequality in our economy, and ensures economic security for all people. These bills point us in that direction.

Read this explainer

Background 

The One Big Beautiful Bill Act (OBBBA) of 2025 set the country on a course toward greater economic disparity. It slashed social infrastructure funding while delivering major tax benefits to wealthy households and corporations. The bill will cost $4.5 trillion over the next decade, and over $117 billion in tax cuts will go to households whose incomes approach or exceed $1 million a year.3 To finance these tax cuts for the wealthy, Congress cut funding for the Supplemental Nutrition Assistance Program (SNAP) and Medicaid. The $1 trillion cut to Medicaid alone will leave an estimated 11 million people without health coverage.4 Congress also chose not to renew enhancements to the Affordable Care Act Premium Tax Credit, meaning that an additional four million people, almost half of whom are Black or Latino, will lose the ability to afford their health coverage.5 That means that four percent of the U.S. population is losing access to affordable health insurance.6

Proposals in Congress 

Currently, the tax code primarily benefits white households by giving preferential tax treatment to wealth. 

Would Make the Tax Code More Equitable In reaction to deepening economic inequality, some members of Congress are proposing bold tax policy changes in an effort to swing the country toward a more equitable tax code and economy. The progressive fiscal policy proposals on the table would make parts of the tax code more equitable, either by raising taxes on those with the most resources and allocating that revenue to fund critical social programs or by reducing tax liability for households with low or moderate incomes. Currently, the tax code primarily benefits white households by giving preferential tax treatment to wealth. Generations of policies and practices have excluded Black and brown people from the opportunity to accumulate wealth that white people have accessed for centuries.7 As a result, white taxpayers hold a disproportionate share of wealth in the United States and hold almost every type of wealth-bearing asset at higher rates than Black or brown households.8 Reforming the tax code to create a federal wealth tax while also increasing taxes on the ultra-wealthy would make the tax code more racially equitable.

Learn more about the bills