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>do what nobody has the balls to do: tax wealth Just to clarify, nobody in the US is doing this, but it's not unheard of elsewhere. For example, Norway has a w

by smeyer 9y ago

>do what nobody has the balls to do: tax wealth Just to clarify, nobody in the US is doing this, but it's not unheard of elsewhere. For example, Norway has a wealth tax of about 0.85% and there are some other examples at https://en.wikipedia.org/wiki/Wealth_tax#Current_examples https://en.wikipedia.org/wiki/Wealth_tax#Current_examples .

khuey 9y ago
We tax real property, which is a form of wealth taxation.
- colanderman 9y ago
  Municipalities do, but the federal government does not.
  - deleted 9y ago
    [deleted]
- saas_co_de 9y ago
  Right. The bank owns 100% of the property. The "owner" is underwater. And the owner pays property tax. So "wealth" taxation is perfectly fine for that situation.
RivieraKid 9y ago
The drawback of taxing wealth is that it distorts markets, it discourages saving. EDIT: Can't comment ("You're posting too fast, blah blah blah"). Here are some replies to the comments bellow: > It's encouraging people to make their money be productive instead of stashing it under a mattress. When you have money in the bank, you're effectively lending most of it to other people. Your money is "productive", which is encouraged by the interest. > Everything distorts markets. The question is how to distort markets into providing the best outcome. Neutral tax (https://en.wikipedia.org/wiki/Optimal_tax https://en.wikipedia.org/wiki/Optimal_tax) doesn't. But of course, market distortion is not the only or primary factor in policy decision-making.
- cperciva 9y ago
  Indeed. And saving/investing is important! It's not a coincidence that the industrial revolution happened in a country with a secure established rule of law such that people could make investments without worrying about losing them at the whim of a dictator. Much better to tax consumption.
  - toomuchtodo 9y ago
    Taxing consumption is regressive; as your wealth increases, the amount of dollars spent relative to your wealth continues to decrease.
    - cperciva 9y ago
      In the long run, every dollar of wealth gets spent. As a practical matter, consumption taxes can be made progressive by combining them with a low-income tax credit or a universal basic income.
      - toomuchtodo 9y ago
        > In the long run, every dollar of wealth gets spent. Not necessarily. "Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Cisco Systems (CSCO) and Oracle (ORCL) are sitting on $504 billion, or 30%, of the $1.7 trillion in cash and cash equivalents held by U.S. non-financial companies in 2015, according to an analysis released Friday by ratings agency Moody's Investors Service. That's even more cash concentration than in previous years, as these five companies held 27% of cash in 2014 and 25% in 2013. Apple alone is holding more cash and investments than eight of the 10 entire industry sectors." [1] Also, the top 1 percent owns 90 percent of wealth in the US [2]. "First, economic inequality has worsened significantly in the United States and some other countries. The richest 1 percent in the United States now own more wealth than the bottom 90 percent. Oxfam estimates that the richest 85 people in the world own as much wealth as the bottom half of humanity. The situation might be tolerable if a rising tide were lifting all boats. But it’s lifting mostly the yachts. In 2010, 93 percent of the additional income created in America went to the top 1 percent." > As a practical matter, consumption taxes can be made progressive by combining them with a low-income tax credit or a universal basic income. I agree that a consumption tax can be combined with other policy to prevent the regressive nature of a consumption tax alone. This requires wealth be taxed in various forms (ownership of investments, land, etc). [1] https://www.usatoday.com/story/money/markets/2016/05/20/third-cash-owned-5-us-companies/84640704/ https://www.usatoday.com/story/money/markets/2016/05/20/thir... [2] https://www.nytimes.com/2014/07/24/opinion/nicholas-kristof-idiots-guide-to-inequality-piketty-capital.html https://www.nytimes.com/2014/07/24/opinion/nicholas-kristof-...
nickoakland 9y ago
Many top corporate executives in Norway & Sweden will evade this by "living" in Switzerland for >183 days a year.
deleted 9y ago
[deleted]
cjlars 9y ago
Inflation is not deductible, so the US (and most other countries) have defacto wealth taxes to the tune of INFLATION RATE * CAPITAL GAINS TAX RATE, or roughly 0.48% annually to high earners in the USA.

by smeyer 9y ago

khuey 9y ago

We tax real property, which is a form of wealth taxation.

colanderman 9y ago
Municipalities do, but the federal government does not.
- deleted 9y ago
  [deleted]
saas_co_de 9y ago
Right. The bank owns 100% of the property. The "owner" is underwater. And the owner pays property tax. So "wealth" taxation is perfectly fine for that situation.

RivieraKid 9y ago

The drawback of taxing wealth is that it distorts markets, it discourages saving. EDIT: Can't comment ("You're posting too fast, blah blah blah"). Here are some replies to the comments bellow: > It's encouraging people to make their money be productive instead of stashing it under a mattress. When you have money in the bank, you're effectively lending most of it to other people. Your money is "productive", which is encouraged by the interest. > Everything distorts markets. The question is how to distort markets into providing the best outcome. Neutral tax (https://en.wikipedia.org/wiki/Optimal_tax https://en.wikipedia.org/wiki/Optimal_tax) doesn't. But of course, market distortion is not the only or primary factor in policy decision-making.

cperciva 9y ago
Indeed. And saving/investing is important! It's not a coincidence that the industrial revolution happened in a country with a secure established rule of law such that people could make investments without worrying about losing them at the whim of a dictator. Much better to tax consumption.
- toomuchtodo 9y ago
  Taxing consumption is regressive; as your wealth increases, the amount of dollars spent relative to your wealth continues to decrease.
  - cperciva 9y ago
    In the long run, every dollar of wealth gets spent. As a practical matter, consumption taxes can be made progressive by combining them with a low-income tax credit or a universal basic income.
    - toomuchtodo 9y ago
      > In the long run, every dollar of wealth gets spent. Not necessarily. "Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Cisco Systems (CSCO) and Oracle (ORCL) are sitting on $504 billion, or 30%, of the $1.7 trillion in cash and cash equivalents held by U.S. non-financial companies in 2015, according to an analysis released Friday by ratings agency Moody's Investors Service. That's even more cash concentration than in previous years, as these five companies held 27% of cash in 2014 and 25% in 2013. Apple alone is holding more cash and investments than eight of the 10 entire industry sectors." [1] Also, the top 1 percent owns 90 percent of wealth in the US [2]. "First, economic inequality has worsened significantly in the United States and some other countries. The richest 1 percent in the United States now own more wealth than the bottom 90 percent. Oxfam estimates that the richest 85 people in the world own as much wealth as the bottom half of humanity. The situation might be tolerable if a rising tide were lifting all boats. But it’s lifting mostly the yachts. In 2010, 93 percent of the additional income created in America went to the top 1 percent." > As a practical matter, consumption taxes can be made progressive by combining them with a low-income tax credit or a universal basic income. I agree that a consumption tax can be combined with other policy to prevent the regressive nature of a consumption tax alone. This requires wealth be taxed in various forms (ownership of investments, land, etc). [1] https://www.usatoday.com/story/money/markets/2016/05/20/third-cash-owned-5-us-companies/84640704/ https://www.usatoday.com/story/money/markets/2016/05/20/thir... [2] https://www.nytimes.com/2014/07/24/opinion/nicholas-kristof-idiots-guide-to-inequality-piketty-capital.html https://www.nytimes.com/2014/07/24/opinion/nicholas-kristof-...

nickoakland 9y ago

Many top corporate executives in Norway & Sweden will evade this by "living" in Switzerland for >183 days a year.

deleted 9y ago

[deleted]

cjlars 9y ago

Inflation is not deductible, so the US (and most other countries) have defacto wealth taxes to the tune of INFLATION RATE * CAPITAL GAINS TAX RATE, or roughly 0.48% annually to high earners in the USA.