Hawaii residents pay some of the highest tax burdens in America. I wondered what would happen if billionaires had to match that rate, so I asked ChatGPT to run the numbers.
The AI came back with detailed calculations showing it would raise billions annually, but the exact amount depends on assumptions about how billionaires actually earn income. Here's what ChatGPT predicted would happen.
The Hawaii Tax Baseline
The average Hawaii resident pays roughly 14% of their income in combined state and local taxes, making it one of the highest-burden states in the country. That's the number ChatGPT used as the target rate for billionaires.
U.S. billionaires collectively hold between $5.5 trillion and $6.6 trillion in wealth depending on which list you reference. But wealth and income are different things, which is where the calculations get complicated.
Current effective tax rates for billionaires vary wildly in estimates. Some academic research shows rates as low as 2% when measuring against economic income, while other analyses put billionaire rates closer to 24%. That massive spread reflects disagreement about what counts as income and how to measure it.
The Key Question: Realized Versus Unrealized Income
ChatGPT explained that taxes apply to realized income, not wealth sitting in stock portfolios. Billionaires don't pay taxes on their Tesla or Amazon shares until they sell them and realize gains.
The AI ran two scenarios based on different assumptions about how much billionaire wealth gets converted to taxable income annually.
Conservative Scenario: 1% Realized
If billionaires realize just 1% of their wealth as taxable income each year, that translates to $55 billion to $66 billion in annual income across all U.S. billionaires.
Applying Hawaii's 14% tax rate to that income produces $7.7 billion to $9.2 billion in annual tax revenue. If current collections sit around 2% (the low estimate), the extra revenue gain would be roughly $6.6 billion to $7.9 billion per year.
ChatGPT wrote that if billionaires already pay closer to 24% currently, this policy might actually cut their taxes rather than raise them.
Higher Scenario: 5% Realized
If billionaires realize 5% of wealth annually -- through capital gains, dividends, business income and salaries -- that creates $275 billion to $330 billion in taxable income.