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> I'd love to hear an argument for why taxing money at rest is worse than taxing it in motion One argument is that money in motion has a reasonably high level

> I'd love to hear an argument for why taxing money at rest is worse than taxing it in motion One argument is that money in motion has a reasonably high level of liquidity, more or less by definition, and, in many cases, a reasonably high level of divisibility. If the wealth that you're taxing has similar attributes then fine. But a significant amount of wealth doesn't have those attributes. Wealth taxes that affect illiquid and/or indivisible assets can have an effect well beyond what they intend. You see this in inheritance taxes. The tax may be reasonable but may also lead to the forced selling of family homes if sufficient disposable assets aren't available.

notacoward 7y ago
> One argument is that money in motion has a reasonably high level of liquidity Fair enough. I believe that's outweighed by other concerns, but it's a reasonable argument made in good faith. Thank you.
antisthenes 7y ago
> You see this in inheritance taxes. The tax may be reasonable but may also lead to the forced selling of family homes if sufficient disposable assets aren't available. This is a benefit, not a drawback. If the million dollar house is just sitting there, unmaintained, and occupying a large plot of land, it's most certainly being underused. Nor are the inheritors entitled to live in the family house in perpetuity. Society may well find a better use for this house, and inheritors will almost certainly be better off with smaller houses that they can afford.