A glance at America’s economic landscape in 2025 shows one constant headline: billionaires’ riches dwarf the incomes of nearly everyone else. The 902 billionaires in the U.S. alone now control $16.1 trillion, an amount greater than the GDP of every other country, except China, per fortune report. Critics argue that this concentration of wealth is amplified by a tax system allowing some of the richest people on Earth to pay less, as a percentage, than teachers and nurses.
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So, what if billionaires paid taxes at the same effective rate as the upper-middle class? ChatGPT offered the below bold predictions, while Brian Kofford, certified public accountant (CPA) weighed in on the feasibility, fairness and economic reality of such a move.
Also find out what it’d look like if billionaires paid middle-class taxes.
The Math: Could Taxing Billionaires Like the Upper-Middle Class Raise Billions?
ChatGPT calculated that if nearly one thousand billionaires paid at a 20% rate, matching many upper-middle-class earners, the U.S. might net “hundreds of billions in annual revenue,” potentially up to $200 billion a year. Oxfam’s estimate supports this idea, projecting that even a modest 3% wealth tax on the ten richest would raise $52 billion annually. These figures are compelling, especially as Congress considers the eye-watering costs of climate initiatives and education reform.
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However, Kofford isn’t quick to sign off. “It sounds nice on paper, but reality is messier. Billionaires don’t earn most of their wealth as wages. If the income isn’t realized, the IRS won’t see those ‘hundreds of billions’ people imagine,” he said.
How Do Billionaires Pay Less?
This disparity stems largely from how wealth is generated and categorized. “[Billionaires] grow their wealth through investments, stocks, real estate and businesses, which are often taxed at much lower rates,” ChatGPT wrote. But here’s the thing, unrealized gains (wealth increases from investments that haven’t been cashed out) remain untouched.
According to Americans for Tax Fairness , the top 400 U.S. billionaire families paid an average effective tax rate of just 8.2% between 2010-18, sometimes even lower. A 2021 ProPublica report showed some paid a “true” tax rate of just 3.4%.
“W-2 workers earn taxable cash every two weeks. Billionaires live off stock, real estate and borrowing against assets, most of which isn’t taxed until sold,” Kofford said. He noted that closing such gaps would mean fundamentally redefining what counts as income, which is politically and administratively challenging.
Impact on Wealth Inequality and Economic Power
Could a new billionaire tax level the playing field? ChatGPT believes so, arguing new revenue could fund universal pre-K, expand Medicare and jumpstart climate investment. “It could increase trust in the tax system, showing that the wealthiest aren’t playing by a different set of rules,” the AI chatbot wrote. Still, the top 1% would hold enormous influence, Oxfam puts it at 43% of the world’s assets.
Kofford isn’t convinced tax hikes alone would fix inequality. “Billionaires didn’t just save harder, they built scalable businesses and assets that compound,” he explained. “Education, entrepreneurship access and smarter financial literacy for the middle class play a bigger role than simply raising someone else’s rate.”
Practical Obstacles: Illiquid Assets and Market Risks
Implementing higher taxes on billionaires introduces serious logistical hurdles. “[Billionaire wealth is] tied up in things like stocks they don’t sell, so taxing that would require big changes to how the tax code works,” ChatGPT wrote. Proposals to tax unrealized gains could force billionaires to sell assets, roil stock markets or resort to massive borrowing.
“Imagine trying to send the IRS a check for stock you own but haven’t sold. Illiquid wealth is tricky,” Kofford explained. The risk isn’t hypothetical, it could create volatility in companies reliant on billionaire stakeholders, impacting jobs and pension funds.
Loopholes and the Path to Real Reform
Current U.S. tax laws allow extensive loopholes. Billionaires can borrow against appreciating assets without triggering taxes and only pay when they decide to sell — sometimes passing gains tax-free to heirs.
While a “billionaire minimum tax” gets floated, Kofford said it’s the most plausible pathway, as it “ensures billionaires can’t legally reduce their effective rate to almost nothing.” Taxing unrealized gains “sounds fair, but in practice it’s a logistical nightmare,” he added.
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This article originally appeared on GOBankingRates.com: ChatGPT Told Us What Would Happen If Billionaires Paid Taxes Like the Upper-Middle Class — Do Real Experts Agree?
