4 ms·

This is a good idea along with progressively decreasing taxes based on how long you hold the shares. They could go down every year all the way to 5% at 10 years

This is a good idea along with progressively decreasing taxes based on how long you hold the shares. They could go down every year all the way to 5% at 10 years. This would have a significant impact on encouraging long-term investing for investors and long-term planning for companies. This should apply only to shares in individual companies and not index funds or mutual funds. It would also encourage a shift away from short-term speculation and to long-term investing in great companies.

DennisP 5y ago
Hadn't heard that one before, that's fantastic.
tpxl 5y ago
> This is a good idea along with progressively decreasing taxes based on how long you hold the shares. They could go down every year all the way to 5% at 10 years. Where I live stocks profits are taxed at 20% at first, then 5% less for each 5 years you hold them, down to 0 taxation after 20 years.
- RandomBK 5y ago
  That sounds amazing! Where is this?
adrianN 5y ago
It would also mean that sufficiently rich people pay only 5% taxes on their income.
- DennisP 5y ago
  Could always tax other things, like consumption, inheritance, or carbon emissions.
  - adrianN 5y ago
    Consumption taxes hit poor people harder than rich people. Inheritance might work, and carbon emissions might also work if you have a tax-and-rebate system so that poor people can still afford stuff.
    - DennisP 5y ago
      Consumption taxes can give rebates just like carbon taxes. A somewhat popular national sales tax proposal a few years back would have done it that way. https://en.wikipedia.org/wiki/FairTax https://en.wikipedia.org/wiki/FairTax
- dilipdasilva 5y ago
  The bigger problem with taxes is that companies are not paying their fair share of taxes in the countries where they generate revenue and profits. Also, this kind of progressive tax reduction should only apply after the company is public. So the clock for VCs, founders, etc only starts at the time of the IPO. This would ensure all the early stakeholders are also aligned in investing in the long-term success of the business. Currently, these early stakeholders are more likely to be focused on cashing out and having a liquidity event.

DennisP 5y ago

Hadn't heard that one before, that's fantastic.

tpxl 5y ago

> This is a good idea along with progressively decreasing taxes based on how long you hold the shares. They could go down every year all the way to 5% at 10 years. Where I live stocks profits are taxed at 20% at first, then 5% less for each 5 years you hold them, down to 0 taxation after 20 years.

RandomBK 5y ago
That sounds amazing! Where is this?

adrianN 5y ago

It would also mean that sufficiently rich people pay only 5% taxes on their income.

DennisP 5y ago
Could always tax other things, like consumption, inheritance, or carbon emissions.
- adrianN 5y ago
  Consumption taxes hit poor people harder than rich people. Inheritance might work, and carbon emissions might also work if you have a tax-and-rebate system so that poor people can still afford stuff.
  - DennisP 5y ago
    Consumption taxes can give rebates just like carbon taxes. A somewhat popular national sales tax proposal a few years back would have done it that way. https://en.wikipedia.org/wiki/FairTax https://en.wikipedia.org/wiki/FairTax
dilipdasilva 5y ago
The bigger problem with taxes is that companies are not paying their fair share of taxes in the countries where they generate revenue and profits. Also, this kind of progressive tax reduction should only apply after the company is public. So the clock for VCs, founders, etc only starts at the time of the IPO. This would ensure all the early stakeholders are also aligned in investing in the long-term success of the business. Currently, these early stakeholders are more likely to be focused on cashing out and having a liquidity event.