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The Tax Foundation is the nation’s
leading independent tax policy
research organization. Since 1937,
our research, analysis, and experts
have informed smarter tax policy at
the federal, state, local, and global
levels. We are a 501(c)(3) nonprofit
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An Analysis of Senator Warren’s
‘Real Corporate Profits Tax’
• Senator Elizabeth Warren (D-MA) released a proposal for a surtax on
corporate profits called the “Real Corporate Profits Tax.”
• The Real Corporate Profits Tax would be equal to 7 percent of a corporation’s
profits as reported on its financial statement with an exemption for the first
$100 million in profits.
• According to the Tax Foundation Model, the Real Corporate Profits Tax
would reduce long-run output by 1.9 percent, shrink the capital stock by 3.3
percent, and reduce wages by 1.5 percent.
• The Real Corporate Profits Tax would raise approximately $872 billion
between 2020 and 2029 on a conventional basis.
• The smaller projected economy over the next decade would result in lower
individual income, payroll, and excise tax revenue collections. As a result, we
estimate that this tax would increase federal revenue by $476 billion between
2020 and 2029 on a dynamic basis.
• The Real Corporate Profits Tax would reduce after-tax income for taxpayers
at all income levels. However, it would raise taxes more for high-income
taxpayers, increasing the progressivity of the U.S. tax code.
Chief Economist and
Vice President of Economic Analysis
TAX FOUNDATION | 2
Senator Elizabeth Warren released a proposal to enact a surtax on U.S. corporations. According
to the Warren campaign, the “Real Corporate Profits Tax” would be equal to 7 percent of the
worldwide profits reported on a corporation’s