A nonpartisan academic study concludes that Democratic presidential candidate Sen. Elizabeth Warren’s proposed "wealth tax" on the richest Americans would bring in at least $1 trillion less than the populist lawmaker from Massachusetts estimates.
Warren’s signature "wealth tax" – which she says would help pay for progressive plans including universal child care, free tuition at public universities and colleges and her government-run "Medicare-for-all" health care system – would place a 2 percent tax on those worth $50 million or more and 6 percent on those worth more than $1 billion.
KEY DEMOCRAT INDICATES WARREN'S WEALTH TAX WOULD FACE HIGH HURDLES IN CONGRESS
A University of Pennsylvania Penn Wharton Budget Model – which offers nonpartisan analysis of public policy proposals – estimates, though, that Warren’s tax would raise between $2.3 trillion to $2.7 trillion over a decade. That’s as much as $1.4 trillion less than the Warren campaign’s estimates. The analysis was released on Thursday.
It also concludes that the new taxes would cause the economy to contract between 0.9 percent and 2.1 percent by 2050 -- depending on how the new revenue is spent. The model says the new tax would reduce "private capital formation" enough to drive the U.S. economy's average wage down between 0.9 percent and 2.3 percent, even affecting households not rich enough to qualify for the tax.
Warren’s campaign disputed the findings.
"This analysis does not study Elizabeth's actual plans -- it does not account for the strong anti-evasion measures in her wealth tax and does not even attempt to analyze the specific investments Elizabeth is committed to making with the wealth tax revenue," Warren campaign spokesperson Saloni Sharma said in a statement to Fox News. "This is an analysis of a different and worse plan than Elizabeth's, using unsupportable assumptions about how the economy works, and its conclusions are meaningless."
The release of the study came hours before Warren was set to deliver an economic address in New Hampshire on how “corruption has fueled the economic challenges facing working families.”
Warren has defended her tax, arguing that the wealthy don't pay their fair share.
The plan – popular with many Democratic presidential primary voters – has for months been a key part of the senator’s stump speech on the campaign trail.
The Associated Press contributed to this report.