Larson Introduces Legislation to Redistribute Company Stock Among All Employees

Washington, D.C. - Today, Rep. John B. Larson (CT-01) introduced the SHARE Plan Act with Reps. Bill Pascrell and Tom Suozzi. The SHARE Plan Act incentivizes corporations to redistribute a material portion of their stock ownership to middle- and lower-income workers.

Stockholders of a company would get long-term capital gains treatment on stock sales only if the company had a "SHARE Plan" in place; otherwise, they would pay at ordinary income tax rates. Such a Plan would require that the company have at least 10 percent of its stock granted over not more than 5 years to at least 80 percent of its employees below senior management ranks. The Act would apply to all publicly traded companies and private companies with 500 or more employees. It would result in the transfer of an estimated $6 trillion dollars in stock value to the middle class.

"For years we have seen a rise in the wealthy getting richer, while middle- and lower-income Americans are left behind. It's time for corporations to share the wealth with all of their employees," said Larson. "The wealth gap is mostly driven by the unequal distribution of stock—the top 10 percent of households hold 88 percent of all stock, while the bottom 50 percent have only 0.6 percent. We need to change that. The SHARE Plan would result in a substantial increase in the wealth of middle- and lower-income Americans."

The idea originated in an article written in 2019 by Robert Patricelli, a former public and private company CEO and federal official. Patricelli said, "Thoughtful businesspeople would agree that the growing wealth gap threatens our economic system and that changes are needed. The SHARE Plan directly redistributes wealth and does it within the private sector, rather than relying on raising taxes in the dubious expectation that government programs can somehow trickle down to increase middle class wealth."