Whitehouse Introduces Bill to Curb Excessive CEO Pay

In 2024, CEOs made 285 times what the average worker earned Washington, DC – As executive pay reaches new heights, U.S. Senator Sheldon Whitehouse (D-RI) is introducing the Curtailing Executive Overcompensation (CEO) Act to apply an excise tax on companies that have at least a 50 to one CEO-to-median-worker pay disparity.  The CEO Act would raise over $8 billion from the top 100 US companies alone, based on 2024 data. “Right now, a handful of mega-billionaires are reaping the rewards of the labor of millions of hardworking Americans.  We are talking about people who have more money than they could ever dream of spending,” said Whitehouse, a senior member of the Senate Finance Committee. “Congress needs to rein in out-of-control CEO pay once and for all.” Since 1978, economic productivity has outpaced workers’ wages by more than four times.  Meanwhile, executive pay has soared by more than 1,209 percent – over 18 times as much as productivity growth, and outpacing the growth of the stock market.  In that same period, workers’ earnings increased only about 15 percent. Tax cuts in President Trump’s Big, Beautiful-for-Billionaires law are set to increase CEO take-home pay even more.  Each CEO is expected to receive $500,000 back from those tax cuts as working families are faced with higher costs of living due to cuts to Medicaid, SNAP, and free school lunches – provisions in that same law.  The CEO Act would incentivize companies to pay their CEOs less while paying their workers more. The CEO Act would apply an excise tax on both publicly traded and privately held companies, which have at least a 50 to one CEO-to-median-worker pay disparity.  The tax would apply only to large companies with over $100 million in gross receipts and $10 million in payroll.  The tax rate imposed would be proportional to the size of the executive’s compensation (including salary, bonuses, and stock awards and options) and the degree the pay ratio exceeds 50 to one.  The tax would be limited to one percent of a company’s gross receipts. The CEO Act is cosponsored by U.S. Senators Tammy Baldwin (D-WI), Elizabeth Warren (D-MA), Jeff Merkley (D-OR), Chris Van Hollen (D-MD), and Peter Welch (D-VT). The CEO Act is endorsed by the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), United Auto Workers (UAW); Communications Workers of America, American Federation of State, County, and Municipal Employees (AFSCME), American Federation of Teachers, International Brotherhood of Teamsters, International Federation of Professional and Technical Engineers (IFPTE), Institute for Policy Studies, Americans for Financial Reform, the Congressional Progressive Caucus, the Global Economy Project at the Institute for Policy Studies, Jobs with Justice, Labor Network for Sustainability, Main Street Alliance, NETWORK Lobby for Catholic Social Justice, Open Markets Institute, Oxfam America, Patriotic Millionaires, People’s Action, Public Citizen, Revolving Door Project, Social Security Works, The Value Alliance, and Unrig Our Economy. A summary of the bill is available here ; bill text is available here .