Gary Cohn says a U.S. wealth tax would be 'harmful' to the economy

Key Points
  • Hiking taxes on rich Americans would hurt the U.S. economy, says former Goldman Sachs president Gary Cohn.
  • "The U.S. tax code is very, very complicated," Cohn says.
Gary Cohn
Kristoffer Tripplaar | The Washington Post | Getty Images

Raising taxes on wealthy Americans would ultimately hurt the U.S. economy, according to Gary Cohn, the former Goldman Sachs president who served 14 months as President Donald Trump's chief economic advisor.

"It would be harmful to the economy," Cohn said in an interview with Leslie Picker on CNBC's "Closing Bell."

"I'm not saying that collecting more tax revenue is harmful to the economy," Cohn said. "I'm saying we have to compete in a global theater."

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Cohn is the latest wealthy financier to warn about the potential risks of raising taxes on the wealthy. When asked about proposals by Rep. Alexandria Ocasio-Cortez, D-N.Y., and Sen. Elizabeth Warren, D-Mass., to boost taxes on income or assets, Cohn launched into an explanation of the U.S. tax code. The former banker had helped oversee the president's corporate tax overhaul that became law at the start of 2018.

"The U.S. tax code is very, very complicated," Cohn said on the sidelines of the Context Summits conference in Miami. "I spent over a year with almost every waking hour in the tax code."

He then suggested that raising personal taxes could make businesses that operate as pass-through entities disadvantaged versus corporations.

"The vast majority of people work for pass-through entities, which is really part of the personal income tax code; it's a hybrid," Cohn said. "We've got to make a level playing field for everyone in the system."

Meanwhile, J.P. Morgan Chase CEO Jamie Dimon said today that he had "no problem paying higher taxes" if the money is spent wisely to "help address some of the fundamental challenges and inequities in our society."

Cohn, 58, spent more than 25 years at Goldman Sachs, rising to become former CEO Lloyd Blankfein's right-hand man in 2006.

Cohn left the New York-based investment bank in 2017 to become director of the National Economic Council for Trump. But Cohn reportedly disagreed with Trump on tariffs and left the administration in April.