Rather than a wealth tax, successful businessman and businesswomen should be pushed to donate more, according to e-commerce billionaire Michael Rubin.
“There has to be more pressure on entrepreneurs, when they create great value, to give back,” Rubin told CNBC’s “Squawk Box” on Monday. “I always bank on an entrepreneur to give back and get great results versus giving that same money to the government.”
Rubin, executive chairman of online sports apparel giant Fanatics, said that while there’s a “responsibility” when it comes to giving back, it’s better to “bet on the entrepreneur who made the money” than on the government. He also has an ownership stake in the Philadelphia 76ers in the NBA and New Jersey Devils in the NHL. His Kynetic firm is the holding company of Fanatics as well as as e-commerce brands Rue Gilt Groupe and Shoprunner.
Pointing to his efforts into reforming the U.S. parole and probation system, Rubin said, “I think we’re going to make a lot more progress than the government can with many more times that money. In January, he partnered with rapper Meek Mill and other sports-team owners and businessmen to donate $50 million to push for systematic changes.
A wealth tax could also stifle American innovation, Rubin added, though he didn’t comment on specific proposals.
“America’s a country where you can come, you can be an entrepreneur, you can create great value,” said Rubin, who never attended college but sold his first company, GSI Commerce, to eBay for $2.4 billion. “I don’t think you ever want to deter that from happening because this is a place where so many great businesses get created and started.”
Rubin’s comments come as a handful of billionaires, including J.P. Morgan Chase CEO Jamie Dimon, ex-Goldman Sachs CEO Lloyd Blankfein and billionaire investor Leon Cooperman, have spoken out against wealth-tax proposals.
Democratic presidential contenders Sens. Elizabeth Warren and Bernie Sanders, both champions of the left, have proposed different versions of a wealth tax, ramping up the rhetoric around the issue.
Warren’s plan calls for a 2% tax on families’ net worth above $50 million and a 6% tax on household net worth over $1 billion. The wealth tax proposed by Sanders, a self-described democratic socialist, would be progressive, starting at 1% for household net worth of more than $32 million and ending at 8% on wealth over $10 billion.