4 ms·

This is very backwards. As percentage of income poor people pay more than rich. If you want to tax über wealthy just tax wealth directly (let’s say 3% on all US

by ivalm 5y ago

This is very backwards. As percentage of income poor people pay more than rich. If you want to tax über wealthy just tax wealth directly (let’s say 3% on all US citizens and residents on all things values above $10mil).

JumpCrisscross 5y ago
Wealth taxes basically guarantee that within a decade most wealth will be held in hard-to-value assets. It then becomes an arms race between lawyers and accountants. Given history, adding complexity to the tax system will benefit the rich at the expense of e.g. those of us with cash and stock and real estate. It would be a levy on the middle class.
- bildung 5y ago
  Wealth taxes basically guarantee that within a decade most wealth will be held in hard-to-value assets. Why isn't this a problem in countries that already tax wealth, like France or Norway?
  - JumpCrisscross 5y ago
    > Why isn't this a problem in countries that already tax wealth, like France or Norway? The literature I’ve seen shows it is [1]. Anecdotally, France’s wealthy have more illiquid holdings and bespoke financial exposures than their American counterparts.(Counterfactual: There are many jurisdictions with wealth taxes [2].) [1] https://faktasiden.com/dokumenter/SSRN-id1268381.pdf https://faktasiden.com/dokumenter/SSRN-id1268381.pdf [2] http://qed.econ.queensu.ca/pub/cpp/Sept1991/Bird.pdf http://qed.econ.queensu.ca/pub/cpp/Sept1991/Bird.pdf
    - bildung 5y ago
      That first paper doesn't talk about about changes in asset allocation due to the ISF. It's main argument is losses due to capital flight.
- ivalm 5y ago
  If the exception is 10mil (as my OP suggests) then it will have no burden on middle class at all. People with nw>10mil are just not middle class. In terms of asset changes, I don’t think this is true, hard to value assets generally have poor returns and definitionally have poor liquidity (which is why they are hard to value!). I’d rather have stock market returns and pay 3% of assets then have something exotic that I can’t sell.
djbebs 5y ago
That's not true. The poorest 50% pay 3% of all taxes and make 13% of all income
- ivalm 5y ago
  Look at sales tax only, since that’s what’s being discussed.
austincheney 5y ago
> just tax wealth directly Wealth comes in many forms. Your comment is void of any such specifics that transform this from fantasy into something that can be taxed. The best case for taxing wealth is an estate tax.
- ivalm 5y ago
  There are lots of existing wealth tax proposal, including annual taxes on all things above some exception. Realistically vast majority of wealth is held in stocks (or other ownership interest instruments), bonds (or other debt instruments), and real estate. These things have common valuation methods (and a wealth tax on real estate is already a thing — property taxes). At the same time, I do support progressive (and at the high end very high) estate tax.

by ivalm 5y ago

JumpCrisscross 5y ago

Wealth taxes basically guarantee that within a decade most wealth will be held in hard-to-value assets. It then becomes an arms race between lawyers and accountants. Given history, adding complexity to the tax system will benefit the rich at the expense of e.g. those of us with cash and stock and real estate. It would be a levy on the middle class.

bildung 5y ago
Wealth taxes basically guarantee that within a decade most wealth will be held in hard-to-value assets. Why isn't this a problem in countries that already tax wealth, like France or Norway?
- JumpCrisscross 5y ago
  > Why isn't this a problem in countries that already tax wealth, like France or Norway? The literature I’ve seen shows it is [1]. Anecdotally, France’s wealthy have more illiquid holdings and bespoke financial exposures than their American counterparts.(Counterfactual: There are many jurisdictions with wealth taxes [2].) [1] https://faktasiden.com/dokumenter/SSRN-id1268381.pdf https://faktasiden.com/dokumenter/SSRN-id1268381.pdf [2] http://qed.econ.queensu.ca/pub/cpp/Sept1991/Bird.pdf http://qed.econ.queensu.ca/pub/cpp/Sept1991/Bird.pdf
  - bildung 5y ago
    That first paper doesn't talk about about changes in asset allocation due to the ISF. It's main argument is losses due to capital flight.
ivalm 5y ago
If the exception is 10mil (as my OP suggests) then it will have no burden on middle class at all. People with nw>10mil are just not middle class. In terms of asset changes, I don’t think this is true, hard to value assets generally have poor returns and definitionally have poor liquidity (which is why they are hard to value!). I’d rather have stock market returns and pay 3% of assets then have something exotic that I can’t sell.

djbebs 5y ago

That's not true. The poorest 50% pay 3% of all taxes and make 13% of all income

ivalm 5y ago
Look at sales tax only, since that’s what’s being discussed.

austincheney 5y ago

> just tax wealth directly Wealth comes in many forms. Your comment is void of any such specifics that transform this from fantasy into something that can be taxed. The best case for taxing wealth is an estate tax.

ivalm 5y ago
There are lots of existing wealth tax proposal, including annual taxes on all things above some exception. Realistically vast majority of wealth is held in stocks (or other ownership interest instruments), bonds (or other debt instruments), and real estate. These things have common valuation methods (and a wealth tax on real estate is already a thing — property taxes). At the same time, I do support progressive (and at the high end very high) estate tax.