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What do you mean, there are systems out there which effectively deal with any and all complaints common folks have against the rich, ie Switzerland and its weal

What do you mean, there are systems out there which effectively deal with any and all complaints common folks have against the rich, ie Switzerland and its wealth tax. Not too much to force everybody to avoid it, not too little to not matter when big sums come into play. Now why this well known approach haven't been implemented in your own country is a question for your own politicians and their donors. Yet rich still come here to live or retire, despite lacking any serious personal tax-haven lure (in some places in some cases taxes are lower than average here, but for real tax havens just within Europe see Channel islands, Luxembourg, Malta, Cyprus, Netherland etc plus everything gets reported back to home countries in case of EU or US).

dr_dshiv 3y ago
The Dutch have a wealth tax too. Actually, it is treated as an income tax: they say that all wealth will produces a typical “fictitious” gain of x% (I think 6%). So, they tax the fictitious gains at 30%. So, that leads to a 2% overall wealth tax. So, if you have $1m in assets, they assume this money makes 6% a year (60k). On the fictitious gains of 60k, they then charge 30% tax (20k). I haven’t checked the specific numbers above, but that’s the gist of it. It seems fair on principle, though I haven’t thought about it too much. Would that be a possibility in the states?
- tetromino_ 3y ago
  How does this fictitious gain tax interact with the non-fictitious capital gains tax? In other words, if I were a rich man, and invested my assets gaining 5% as opposed to keeping them in a Scrooge McDuck vault, would I be taxed at 30% of fictitious 6% + 30% of real 5% i.e. effectively at 66% of my capital gains, or only at the "fictitious" income, or only at the real capital gains?
  - j4yav 3y ago
    There’s no real capital gains. You’d always be taxed the fictitious amount, whether or not you made more or less, or even lost money. But they are planning to change it because it was unfair to people who just put their wealth in their checking account and were being taxed as if they invested it.
  - Pepe1vo 3y ago
    No, your actual gain in capital would not be taxed. The only thing that is being taxed is the "fictitious" gain on the monetary value of your capital at a certain date (peildatum). Everyone agrees that this system is dumb as shit, but our tax department is too incompetent to implement a sane capital gain tax like they have in, for example. Australia.
- lifestyleguru 3y ago
  > wealth will produces a typical “fictitious” gain of x% (I think 6%). So, they tax the fictitious gains at 30%. So, that leads to a 2% overall wealth tax. I simply don't believe rich Dutch are paying this tax on their price bloated real estate in Netherlands, Spain, Dubai, Caribbean Islands and wherever. This would be enourmous fortunes in annual wealth tax.
- _heimdall 3y ago
  While living in the Netherlands I never considered the wealth tax fair. The government is making an assumption that I am going to invest my money and that I invest it well enough to get an average return. Not everyone will went to invest their wealth in risky assets though, and not everyone who does invest it will do well. Their justification for the tax rate is only that, a justification. In reality the wealth tax isn't directly tied to investment returns and serves only to disincentivize saving your wealth. It pushes people to invest their wealth in risky assets, meaning they effectively want all individuals to hold a pile of IOUs rather than actual wealth accrued over their lifetime. The same can be said for a target inflation rate of 2-3%. Adding a wealth tax on top just turns the screws a bit more, more strongly pushing individuals to put most wealth they accrue right back into the slot machine.
refurb 3y ago
Switzerland? "effectively deal with any and all complaints common folks have against the rich"? That's laughable. Switzerland is a known tax haven for the wealthy through legit and non-legit means. Has been for centuries. A majority of the population thinks wealth inequality in Switzerland is too high https://www.swissinfo.ch/eng/society/majority-consider-inequality-between-the-rich-and-the-poor-to-be-too-large-in-switzerland/49076180 https://www.swissinfo.ch/eng/society/majority-consider-inequ... I'd say the way the rich in Switzerland have effectively managed it, is to keep their mouth shut. There are plenty of very wealthy people who never show up on the Forbes list because their money isn't new and it isn't public.
- mlrtime 3y ago
  > There are plenty of very wealthy people who never show up on the Forbes list because their money isn't new and it isn't public. This is a very important fact that is lost on most people. When people hate on Bezos, Gates and Musk for their wealth, it's because it is all based on stock wealth that is transparent. They don't have this cash sitting in a bank. However, there are undoubtably people with much more money than these 3 with assets so hidden governments can barely keep tabs on their actual wealth. So we just settle on easy targets.
Gareth321 3y ago
Wealth taxes have all kinds of major issues. Many countries have attempted them, such as Sweden, then reversed them, because of adverse outcomes. Primarily, wealth flight. The wealthy can live wherever they want. They often pick Switzerland. In a perfect world we would have an international wealth tax agreement, which would enforce the same wealth tax no matter where the wealthy fled. Because we don't have that, wealth taxes usually result in adverse outcomes. I think land value tax is much better, and solves a number of other structural economic issues at the same time.
Dah00n 3y ago
Well, you sure jumped to some conclusions there. First off, it seems you believe I'm from the US? I'm not, and we do have wealth tax where I live. Secondly, taking a system - let's call it X - and add some more tax to it (X + tax) is still X. That was the whole point of my argument, which you seem to reinforce: Any talk about a different system is near impossible online. Either people start screaming obscenities or try to tweak a system with tweaks that has already been tried and failed to change the world in any meaningful way. Does it work in Switzerland? It seems you believe so, but how does it change the world for the better? In my opinion, it is a completely useless change from the big perspective. The world doesn't become measurably better because of it. Rather, it is at best at tiny tweak that help to keep a completely broken system in place.

dr_dshiv 3y ago

The Dutch have a wealth tax too. Actually, it is treated as an income tax: they say that all wealth will produces a typical “fictitious” gain of x% (I think 6%). So, they tax the fictitious gains at 30%. So, that leads to a 2% overall wealth tax. So, if you have $1m in assets, they assume this money makes 6% a year (60k). On the fictitious gains of 60k, they then charge 30% tax (20k). I haven’t checked the specific numbers above, but that’s the gist of it. It seems fair on principle, though I haven’t thought about it too much. Would that be a possibility in the states?

tetromino_ 3y ago
How does this fictitious gain tax interact with the non-fictitious capital gains tax? In other words, if I were a rich man, and invested my assets gaining 5% as opposed to keeping them in a Scrooge McDuck vault, would I be taxed at 30% of fictitious 6% + 30% of real 5% i.e. effectively at 66% of my capital gains, or only at the "fictitious" income, or only at the real capital gains?
- j4yav 3y ago
  There’s no real capital gains. You’d always be taxed the fictitious amount, whether or not you made more or less, or even lost money. But they are planning to change it because it was unfair to people who just put their wealth in their checking account and were being taxed as if they invested it.
- Pepe1vo 3y ago
  No, your actual gain in capital would not be taxed. The only thing that is being taxed is the "fictitious" gain on the monetary value of your capital at a certain date (peildatum). Everyone agrees that this system is dumb as shit, but our tax department is too incompetent to implement a sane capital gain tax like they have in, for example. Australia.
lifestyleguru 3y ago
> wealth will produces a typical “fictitious” gain of x% (I think 6%). So, they tax the fictitious gains at 30%. So, that leads to a 2% overall wealth tax. I simply don't believe rich Dutch are paying this tax on their price bloated real estate in Netherlands, Spain, Dubai, Caribbean Islands and wherever. This would be enourmous fortunes in annual wealth tax.
_heimdall 3y ago
While living in the Netherlands I never considered the wealth tax fair. The government is making an assumption that I am going to invest my money and that I invest it well enough to get an average return. Not everyone will went to invest their wealth in risky assets though, and not everyone who does invest it will do well. Their justification for the tax rate is only that, a justification. In reality the wealth tax isn't directly tied to investment returns and serves only to disincentivize saving your wealth. It pushes people to invest their wealth in risky assets, meaning they effectively want all individuals to hold a pile of IOUs rather than actual wealth accrued over their lifetime. The same can be said for a target inflation rate of 2-3%. Adding a wealth tax on top just turns the screws a bit more, more strongly pushing individuals to put most wealth they accrue right back into the slot machine.

refurb 3y ago

Switzerland? "effectively deal with any and all complaints common folks have against the rich"? That's laughable. Switzerland is a known tax haven for the wealthy through legit and non-legit means. Has been for centuries. A majority of the population thinks wealth inequality in Switzerland is too high https://www.swissinfo.ch/eng/society/majority-consider-inequality-between-the-rich-and-the-poor-to-be-too-large-in-switzerland/49076180 https://www.swissinfo.ch/eng/society/majority-consider-inequ... I'd say the way the rich in Switzerland have effectively managed it, is to keep their mouth shut. There are plenty of very wealthy people who never show up on the Forbes list because their money isn't new and it isn't public.

mlrtime 3y ago
> There are plenty of very wealthy people who never show up on the Forbes list because their money isn't new and it isn't public. This is a very important fact that is lost on most people. When people hate on Bezos, Gates and Musk for their wealth, it's because it is all based on stock wealth that is transparent. They don't have this cash sitting in a bank. However, there are undoubtably people with much more money than these 3 with assets so hidden governments can barely keep tabs on their actual wealth. So we just settle on easy targets.

Gareth321 3y ago

Wealth taxes have all kinds of major issues. Many countries have attempted them, such as Sweden, then reversed them, because of adverse outcomes. Primarily, wealth flight. The wealthy can live wherever they want. They often pick Switzerland. In a perfect world we would have an international wealth tax agreement, which would enforce the same wealth tax no matter where the wealthy fled. Because we don't have that, wealth taxes usually result in adverse outcomes. I think land value tax is much better, and solves a number of other structural economic issues at the same time.

Dah00n 3y ago

Well, you sure jumped to some conclusions there. First off, it seems you believe I'm from the US? I'm not, and we do have wealth tax where I live. Secondly, taking a system - let's call it X - and add some more tax to it (X + tax) is still X. That was the whole point of my argument, which you seem to reinforce: Any talk about a different system is near impossible online. Either people start screaming obscenities or try to tweak a system with tweaks that has already been tried and failed to change the world in any meaningful way. Does it work in Switzerland? It seems you believe so, but how does it change the world for the better? In my opinion, it is a completely useless change from the big perspective. The world doesn't become measurably better because of it. Rather, it is at best at tiny tweak that help to keep a completely broken system in place.