5 ms·
That's why I think more appropriate way to think about wealth tax is not actual practical implementation, but more like a goal. So no adding together all wealt
by beefield 7y ago
That's why I think more appropriate way to think about wealth tax is not actual practical implementation, but more like a goal.
So no adding together all wealth, but tax the value of real estate instead of the rental income. Tax market cap of public corporations instead of their profit. Tax cars, boats and business jets. Tax bonds and other securities on their value instead of revenue. Etc. All these ibdividual taxes are going to have issues to be sorted out before implementing, bit I argue that as individual taxes, the issues are way easier to solve than for one generic wealth tax.
- psweber 7y agoThat does sound reasonable. People game the current system to the maximum. How would you expect people to game a system of taxing the obvious assets, and what could be done about it?
- mattrp 7y agoThe way they would game it would be by building unpermitted structures. Read Hernando de Soto’s mystery of capital - he talks how this happens all over the world as a way to store wealth. The problem is it can’t be financed so the capital is stranded and it’s unsafe - many years ago there was a small earthquake (maybe a 6) in turkey and it leveled the region despite earthquake building codes that had been in place for decades. If you had an old structure it survived, the new ones were decimated. Why? The unpermitted buildings avoided the building code regulations. Anyone remember the last time LA had a six earthquake... that’s right you don’t because no one in LA cares about a six because we haven’t yet destroyed our economy through perverse taxing and over regulation.
- mc32 7y agoWouldn’t taxing wealth reduce the real value of properties? Say you have a 100 acre farm[1] valued at $100 and produces $10 of goods annually. If you start taxing on the $100, no one is going to pay $100 for the farm once a wealth tax is implemented as now they are taking on tax liability that previously didn’t exist. [1]for the sake of argument and illustration, were ignoring property taxes which are like wealth taxes.
- croon 7y agoIs that a problem (within reason)?
- pjc50 7y agoDepends entirely on what the tax rates are and what other conditions apply. Pay 1% tax of a dollar, collect $10 in agricultural subsidies? Besides, for residential property, stemming the unsustainable increase in value is also a desireable goal to make it more affordable.
- naravara 7y agoAlternatively, it could create incentives to develop and use existing property for higher productivity applications.
- mc32 7y agoI see it being regressive and encouraging small farmers to sell out to large operators who can more economically scale production.