Still, "There's no free lunch here. You'd have to collect more money," Gates told CNN's Fareed Zakaria on Sunday.
That money should come from rich people in the form of higher taxes, he said. "As you go about doing this additional collection, of course you want to be progressive. You want the portion that comes from the top 1 percent or top 20 percent to be much higher," Gates said.
Gates has been a frequent advocate of taxing the wealthy at higher rates. Gates told Zakaria last year, "I need to pay higher taxes … I've paid more taxes, over $10 billion, than anyone else, but the government should require people in my position to pay significantly higher taxes."
In particular, Gates suggested raising the capital gains tax, which is the tax levied on profits earned when a property or investment is sold. Currently the capital gains tax is 20 percent on net capital gains when the taxpayer's taxable income is higher than the threshold for the regular 37 percent tax rate, according to the Internal Revenue Service; that's $425,800 for single filer, $479,000 for married filing jointly or qualifying widow(er), $452,400 for head of household and $239,500 for married filing separately.