Defining extreme wealth is more complicated than it looks

Facing high levels of income and wealth inequality and shrinking tax revenues, U.S. policymakers are showing increased interest in proposals to tax the richest households. Yet determining which households fall into that category is complex and changes based on which data sources are used, which units of analysis are measured, and other methodological variances.

These distinctions shape which households a policy targets, how much revenue it raises, how researchers analyze its effectiveness, and how policymakers understand its impact. In short, they are not just fodder for academic debates but are essential to the policymaking process as well.

For more, read Equitable Growth’s report (opens in a new tab) and factsheet (opens in a new tab) on defining the top income and wealth thresholds for tax policy design and analysis.