Seeking funds for their $3.5 trillion budget package, a Democratic senator has proposed a plan to end tax breaks on exchange-traded funds (ETFs).

In a proposal for draft legislation released last week, Senate Finance Committee Chairman Ron Wyden (D-Ore.) floated a new levy on ETFs, claiming it would help stop wealthy investors and companies from skirting capital gains taxes CNBC reported.

ETFs are baskets of assets—such as stocks or bonds—and can be traded like shares. Though investors do not directly own the shares, a fund manager may buy or sell the underlying assets to financial institutions. Regular investors typically avoid taxes while owning ETFs because financial institutions can swap the underlying assets for others, known as an “in-kind” trade, which does not trigger capital gains.

The measure proposed by Wyden would target these tax-free “in-kind” transactions, aiming to crack down on the financial institutions that bypass capital gains taxes.

“We’re only talking about the taxable accounts of the wealthiest investors,” Wyden said in a statement.

“This particular proposal simply applies the same rules already in place for corporations to regulated investment companies, so wealthy investors can no longer avoid all tax on their gains,” he added.

According to preliminary estimates from the Joint Committee on Taxation, his proposal may help raise $200 billion over the next decade.

However, opponents claimed that eliminating the tax break for ETFs may negatively affect all investors across the $6.8 trillion exchange-traded fund industry in the United States.

Around 12 million U.S. households are estimated to own ETFs in their portfolios.

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