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Tax the Rich – European Citizens' Initiative

44 points by janandonly 2y ago

anovikov 2y ago
Rather stupid idea to attack those who call the shots. Try doing it and they change the government for the more agreeable one. Because the initiative is leftist, who that will be? Far right. Result: Putin wins. In the very best case, they simply leave. You end up with the same number of poor, but no rich. Will that make anyone happier? Those speaking of "exit tax": it's no secret that their money is not invested in Europe. So if they leave, they just leave, no exit tax. Why? You seen EU stock performance? They are all in the US. In part because far-left initiatives like that have no chance in the US. But mostly because stocks there work because money isn't being sucked out of the underlying companies by the takers on one hand, and investors also have money to pour in because they are taxed less. Very best end result: you make Europe even more behind on everything because you will have all the same takers, but even fewer makers.
- misja111 2y ago
  Doesn't the US have exit-tax already?
  - anovikov 2y ago
    It does but for US taxpayers. If you are a US taxpayer, you pay it if you exit. But those people are not us taxpayers, they happily pay NRA withholding tax (15% on dividends) and that's it.
- olivergregory 2y ago
  They won't leave. For 50 years in the US, the maximum tax rate was right below 80%. That didn't make the country poorer, on the contrary: that was the time the US asserted itself as the main planetary superpower. "The rich will leave" is a myth. Probably some opportunists like Elon Musk will, but he's just the (extremely) vocal minority. Most recently in Norway after a targeted tax, out of 230k+ millionnaires and billionnaires, a lot vocally said they would leave while only 30 actually did, which was just marginally over the usual migration rate for that category of people. So even though no one ever proved that "the rich will leave" (while the opposing has been shown numerous times) over the last century, the simple workaround is to make the tax global or at least as wide as possible, which is what is attempted here.
  - anovikov 2y ago
    The initiative is European, not American. They will leave Europe for sure. In America, there's no threat of rising taxes for the rich, they control things too well.
    - olivergregory 2y ago
      Saying it won't make it real. It's a myth, it's been debunked several times. The myth persists.
      - nec4b 2y ago
        No it's not a myth. It happened in France when socialist president Holland imposed a "tax on the rich" and it was quickly backtracked after most of the rich packed their bags.
  - bwb 2y ago
    Nobody paid the 80% tax rate btw, tax system was very diff back then. https://www.aier.org/article/the-rich-never-actually-paid-70-percent/ https://www.aier.org/article/the-rich-never-actually-paid-70...
    - beej71 2y ago
      "Persons in the $1 million income filing bracket in 1963 faced an average effective tax rate of just over 40 percent of their adjusted gross income (AGI) for the year." Let's do that, then.
  - foven 2y ago
    Ultimately they still live in the country. They have ties to it. Their assets and wealth may be tied up in the country which is difficult to extricate. And, most importantly, their friends, family and life are in that country. It is absurd to think that it is so easy for people to just pack up and leave a country.
dinkblam 2y ago
didn't surprise me to see this backed by notorious piketti
- luma 2y ago
  Is there a specific policy angle here that has you concerned?
- sambeau 2y ago
  I'd be interested to hear exactly what it is that Thomas Piketty has done that makes you call him notorious. Piketty's writing is deep and profound. It is well-researched. It makes sense. It has had a real effect on my own thinking. It has been widely acclaimed by The New York Times, The Economist, The Financial Times, The New Yorker, … The criticism I've seen of Piketty are typically shallow and hand-wavy, usually by people who have clearly done no more than skim-read the introduction to Capital. Capital is a giant 500+ page book—every claim it makes is backed up by extraordinary detail. Piketty's main claim is simple: the world economy is completely unbalanced, bringing misery to most of its inhabitance. He explains how this imbalance is the result of Global Capitalism running amok without any checks or balances. Would anyone sane disagree with this premise in a world about to see its first trillionaire? Modern economic thinking is dominated by economists who seem to wilfully misunderstand how capitalism is failing humanity and damaging the planet. They seem scared to point out the obvious fact that in a world of trillionaires expecting interest on their capital, their capital will bleed the world dry. Maybe you should read Capital before you dismiss one of the most influential thinkers of the past few decades.
dakiol 2y ago
From the FAQ > In Belgium, for example, we propose that anyone with 1.25 million euros in assets in addition to their main home and business assets should qualify as "ultra-rich". Uh. That’s a very low bar. I was expecting something above 50 to 100 million euros. As a software engineer, I think (I hope) to reach that number before retirement… and I wouldn’t consider myself “ultra-rich”. I can only imagine the bar is even lower in other countries.
- jamil7 2y ago
  If you own your home outright plus have 1.25 M€ in assets you would be considered very well off in all of Europe. I don't exactly know about "ultra-rich" though.
  - Rinzler89 2y ago
    Pretty much. If you look at the average wealth of the average German it's just sad. Europeans don't have much wealth and building wealth without inheritance is getting increasingly harder.
    - yodsanklai 2y ago
      More interesting is the median wealth per adult. Several European countries are comparable or above the US for instance. https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult https://en.wikipedia.org/wiki/List_of_countries_by_wealth_pe... I'm a bit surprised to see how low Germany is on the list though.
      - vidarh 2y ago
        Partly there are wealth disparities, but there is also less value in building wealth in systems where your healthcare and pensions are reasonable even if you can. Unless you're dead set on leaving an inheritance, there is far less risk in spending what you can, or e.g. buying annuities that will run down your assets but guarantee you a lifetime income.
      - 2y ago
sandwichmonger 2y ago
[flagged]
- sambeau 2y ago
  On-Topic: Anything that good hackers would find interesting. That includes more than hacking and startups. If you had to reduce it to a sentence, the answer might be: anything that gratifies one's intellectual curiosity. Off-Topic: Most stories about politics … unless they're evidence of some interesting new phenomenon This passes both tests.
  - sandwichmonger 2y ago
    I don't see how wanting to tax the rich is an interesting new phenomenon.
- deleted 2y ago
  [deleted]
- vernon99 2y ago
  I know it's hard to imagine but not everybody acts purely in self-interest. I'm also supportive of this, even though I'd be taxed more.
bwb 2y ago
Whats funny is this exempts business assets lol. Just increase the tax on dividends and capital gains in a progressive manner. And be prepared if the economy slows as a result (not up to date on what economists report there). Spain has a wealth tax and their economy is not doing so well. Everyone in Spain shields it by putting it in real estate and putting a business around it. And nobody can sell their business as that opens them to the wealth tax, so you get wage stagnation, and a general economic malaise as zombie companies limp along. Nice flashy website though.
- deleted 2y ago
  [deleted]
- vidarh 2y ago
  Norway has a wealth tax too, and the wealth tax applies to your shares as well, so wrapping a business around your holdings at best gives you a discount.
  - deleted 2y ago
    [deleted]
  - bwb 2y ago
    Does Norway have capital gains? Switzerland also has a wealth tax. It can work in small countries with unique resources or focuses. But they are the few, and Switzerland treats it more like a club with negotiating on the top end.
    - vidarh 2y ago
      Yes, up to 38% (above a threshold, and with heavy deductions for holding an asset long-term) Switzerland is the favored destination for rich Norwegians seeking to avoid Norwegian wealth tax, as it typically ends up far lower - not sure of the specifics.
- sandwichmonger 2y ago
  [flagged]
deleted 2y ago
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sakex 2y ago
According to the article they link[1], the 1% richest is defined as earning more than $109,000 in 2015. So basically, they want to tax the people who already pay the most taxes. Actually rich people having the means to avoid paying taxes altogether, it's the educated middle class that's once again expected to pay for opaque, poorly managed, and unaccountable government programs. Glad I live in Switzerland. [1] https://www.oxfam.org/fr/communiques-presse/les-1-les-plus-riches-sont-responsables-de-deux-fois-plus-demissions-que-la#:~:text=Les%201%20%25%20les%20plus%20riches%20de%20la%20population%20mondiale%20sont,sans%20pr%C3%A9c%C3%A9dent%20d'%C3%A9missions%20polluantes https://www.oxfam.org/fr/communiques-presse/les-1-les-plus-r....
- JumpCrisscross 2y ago
  > the 1% richest is defined as earning more than $109,000 in 2015 Why are they using a global threshold? What fraction of Europeans does this cover? (How is that distributed?)
  - sakex 2y ago
    They don't bother explaining
  - sushibowl 2y ago
    They are not. The proposal text itself doesn't mention taxing "the 1% richest" or any threshold at all really. It's quite vague on the specifics: > Firstly, we call on the European Commission to draft a proposal for a directive establishing a European excess wealth tax, based on Article 115 TFEU. In any case, the proposal is for a wealth tax, so income is irrelevant. I think the proposed wealth threshold for taxation is supposed to vary by country.
    - spwa4 2y ago
      The problem with "taxing the rich". If we're talking Bezos, Musk and Gates, that's 3 people. To have any decent amount of extra income for states, they must tax "the 1%", and really "the 10%". And if we're then talking about amounts, everybody will immediately, and rightly, claim that "the 1%" is not a livable wage in X. And they're right. You cannot live in Amsterdam on 66000 EUR per year. I mean, it's probably possible, with a great many compromises, but not really. The problem is: "the 1%" in Europe (EU-27): anything more than 66000 EUR "the 10%" in Europe (EU-27): anything more than 34000 EUR I think these figures are not talking about individual income, but about FAMILY income (both partners). It's EU-27 because it used to be EU-28, and then Brits decided ... So, in the Netherlands, I believe that means more than 80% of the population is in "the 10%" of Europe and almost 60% of the population is in "the 1%" of Europe. I doubt even Dutch communists would support this tax.
JumpCrisscross 2y ago
The proposal is to give the Commission the power to enact a direct wealth tax and fund green things? No numbers? Really? So presumably, every EU nation’s tax office would furnish some EU commissar with everyone’s wealth? Which they would be in charge of measuring? (Presumably everyone. Because if it’s only everyone above a certain wealth, there are games to be played with how wealth is counted and who does the counting at the national level.) Also, is this subject to any single nation vetoing it? EDIT: Never mind, this exempts business assets, it’s a total farce.
gatinsama 2y ago
Why not just ask for a more progressive tax system instead of trying to instill class warfare? Sounds commie to me.
- tjpnz 2y ago
  Because that's not going to achieve anything. If you're rich you already structure your affairs to minimize your income tax exposure.
jcfrei 2y ago
While I'm a fierce proponent of wealth taxes, efforts like this one will hurt finances of the EU and the middle class more. Only focusing on the EU means the really rich will just move their assets abroad to avoid taxes. Efforts like these need to be enacted on an OECD level and first focus on the $100M+ crowd at a low tax rate. Keeping expectations for massive social impacts low and making sure all loopholes and issues are closed before moving to broader wealth taxes - otherwise the populists will claim failure after a few years (populists backed by rich donors) and call for abandonment of wealth taxes - so they get some peace for the next 50 years. Equally important we also need to be clever how to implement this tax collection. The ideal setup is a form of sovereign wealth fund, where individuals that need to pay the tax can loan out shares of their company. The issue for lots of very rich people is that they are not liquid enough to fund these taxes. The solution is to allow tax collection by giving these individuals the opportunity to deposit shares of their company as collateral at a wealth fund - giving the fund access to dividend payouts (those need to be tax free) that then cover the required taxation. That way owners of family businesses can keep ownership of their companies and still pay wealth taxes.
- maxrecursion 2y ago
  That's a good idea for how the ultra rich can pay taxes without forcing them to liquidate stock, and at least addresses the core of the problem. But if the stock "shared" with the tax collector paid enough in dividends to cover the taxes, couldn't they just pay the taxes with the dividends to begin with? How does sharing the stock help? Wouldn't the tax collector need to liquidate the stock to get any actually value from it?
  - lhpz 2y ago
    A stock retains value even without producing dividends. Allowing wealth tax payments in the form of stock, rather than cash, addresses the liquidity issue, especially for large family-owned companies. The challenge lies in accurately valuing the stock for private companies, but that's where finance experts come in ! Furthermore, an agreement between the taxpayer and the wealth fund could accompany the transaction, including terms like holding the stock for a specified number of years, buyback preferences, or limited voting rights. At a discount on the stock price. Given the financial and legal complexities, as well as the challenges in standardizing the process, this would only apply to payments of a highly substantial amount. But one could argue that these individuals are no longer equal to others in terms of their tax obligations, as they have some ability to negotiate to a certain extent. That's probably the main problem. Just thinking out loud !
thih9 2y ago
There is an example for Belgium, is there a list with values for other countries? > The criteria for defining an "ultra-rich" should vary from one EU country to another, due to the economic, fiscal and social differences between member states. In Belgium, for example, we propose that anyone with 1.25 million euros in assets in addition to their main home and business assets should qualify as "ultra-rich".
rglullis 2y ago
I guess what happened in France with Hollande was not enough of a lesson? Anyway, I will repeat: don't tax the rich because of the capital they have to control the corporations, insult get rid of corporations entirely. Make it so that: - companies must be limited to a certain size (on the order of 250) - no individual can work in more than one organization - individual contractors dedicating more than 30% of their time to any specific company should count towards the cap of the hiring entity. Concentration of wealth is only a problem because of the power that gives them via the corporations they control. Get rid of the corporations and you get rid of the problem. Politically speaking, is a lot easier to sell the idea to both sides of the table, while "end billionaires" is something that only appeals to the left.
- JumpCrisscross 2y ago
  > Get rid of the corporations and you get rid of the problem Wealth concentration predates corporations. Every country with terrible courts lacks true corporations. See how they organise business. (Hint: it’s family and tribes.)
  - rglullis 2y ago
    Wealth concentration happens when you have institutions that grow without checks. Before liberalism, this was Church and State. > Every country with terrible courts lacks true corporations. Define terrible. One could argue that the lobby-dominated system from the US is very far from "good".
newsclues 2y ago
The rich will avoid the bulk of the taxation. Others will pay for these "progressive" wealth transfers. Economic collapse may be the goal.
deleted 2y ago
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tirant 2y ago
It is not only sad that fellow citizens want to impoverish Europeans, but also completely counterproductive, especially in the context of an aging population and struggling pension systems. Here's the thing: European countries already have pension systems based on pay-as-you-go models, where current workers fund retirees. But as the population ages and fewer people are working compared to those retiring, the math just doesn't work anymore. The pension system simply won’t be able to sustain the increasing number of retirees. In this context, citizens need to save and build personal capital to ensure they can retire comfortably. The problem with a wealth tax is that it discourages exactly that: saving and investing. By taxing accumulated wealth, you're punishing those who manage to put money aside for their future. This discourages long-term planning and encourages short-term consumption instead. The irony is that governments should be promoting savings and investments to fill the gap where pension systems will inevitably fall short. A wealth tax sends the opposite message and risks leaving people even more vulnerable when they retire, without the state providing enough, and without citizens having been incentivized to build their own safety net. It's one of those "feels-good-on-paper" policies that ends up hurting the very people it's meant to help by making it harder for them to secure their own financial future.
Ekaros 2y ago
3 weeks to go? I don't think this one is going to pass. And for good reasons it is just really vague in the form that is on the initiative.
DataDaemon 2y ago
We already had communism in part of Europe.
Yizahi 2y ago
We don't need to tax the rich (yet). We need to "tax" fucking offshores. That's where stolen money is flowing from all citizens.
jamil7 2y ago
These people should put their minds toward instrumenting reform across the EU and modernizing decrepit and corrupt state institutions before they start talking about giving these bodies even more tax money to piss away.
indigo0086 2y ago
Doesn't help the "europoor" moniker by aiming so low. Shows bigger issues with Europe than taxing the rich can solve
snapplebobapple 2y ago
This is the exact opposite of what is needed both from a social services funding perspective and a wealth concentration perspective. People look at the rich and are justifiably pissed because they see them holding a ton of power because of control of businesses that have a ton of market power (i.e. oligopolies/monopolies) to abuse via rent seeking. The correct solution to that is more aggressive antitrust enforcement actually breaking up many of these oligopolies, which will cut down on the rent seeking and make the market far more dynamic allowing people with good ideas to grow real competitors more easily. From the social service funding perspective, pretty much every first world country is flush with funding. Their problem is incredible amounts of misuse/abuse/corruption/misallocation. which we should be focusing on fixing. The above plan will just hurt those aspiring to be rich who have much more limited options for hiding their income/wealth from taxes, cementing in the rent seekers already at the top. Any further tax revenue will be going into incredibly inefficient and wasteful spending pipelines and will concentrate more power into those pipelines. It's a lose lose lose for everyone in those countries and everyone in the future.

44 points by janandonly 2y ago

Rather stupid idea to attack those who call the shots. Try doing it and they change the government for the more agreeable one. Because the initiative is leftist, who that will be? Far right. Result: Putin wins. In the very best case, they simply leave. You end up with the same number of poor, but no rich. Will that make anyone happier? Those speaking of "exit tax": it's no secret that their money is not invested in Europe. So if they leave, they just leave, no exit tax. Why? You seen EU stock performance? They are all in the US. In part because far-left initiatives like that have no chance in the US. But mostly because stocks there work because money isn't being sucked out of the underlying companies by the takers on one hand, and investors also have money to pour in because they are taxed less. Very best end result: you make Europe even more behind on everything because you will have all the same takers, but even fewer makers.

misja111 2y ago
Doesn't the US have exit-tax already?
- anovikov 2y ago
  It does but for US taxpayers. If you are a US taxpayer, you pay it if you exit. But those people are not us taxpayers, they happily pay NRA withholding tax (15% on dividends) and that's it.
olivergregory 2y ago
They won't leave. For 50 years in the US, the maximum tax rate was right below 80%. That didn't make the country poorer, on the contrary: that was the time the US asserted itself as the main planetary superpower. "The rich will leave" is a myth. Probably some opportunists like Elon Musk will, but he's just the (extremely) vocal minority. Most recently in Norway after a targeted tax, out of 230k+ millionnaires and billionnaires, a lot vocally said they would leave while only 30 actually did, which was just marginally over the usual migration rate for that category of people. So even though no one ever proved that "the rich will leave" (while the opposing has been shown numerous times) over the last century, the simple workaround is to make the tax global or at least as wide as possible, which is what is attempted here.
- anovikov 2y ago
  The initiative is European, not American. They will leave Europe for sure. In America, there's no threat of rising taxes for the rich, they control things too well.
  - olivergregory 2y ago
    Saying it won't make it real. It's a myth, it's been debunked several times. The myth persists.
    - nec4b 2y ago
      No it's not a myth. It happened in France when socialist president Holland imposed a "tax on the rich" and it was quickly backtracked after most of the rich packed their bags.
- bwb 2y ago
  Nobody paid the 80% tax rate btw, tax system was very diff back then. https://www.aier.org/article/the-rich-never-actually-paid-70-percent/ https://www.aier.org/article/the-rich-never-actually-paid-70...
  - beej71 2y ago
    "Persons in the $1 million income filing bracket in 1963 faced an average effective tax rate of just over 40 percent of their adjusted gross income (AGI) for the year." Let's do that, then.
- foven 2y ago
  Ultimately they still live in the country. They have ties to it. Their assets and wealth may be tied up in the country which is difficult to extricate. And, most importantly, their friends, family and life are in that country. It is absurd to think that it is so easy for people to just pack up and leave a country.

dinkblam 2y ago

didn't surprise me to see this backed by notorious piketti

luma 2y ago
Is there a specific policy angle here that has you concerned?
sambeau 2y ago
I'd be interested to hear exactly what it is that Thomas Piketty has done that makes you call him notorious. Piketty's writing is deep and profound. It is well-researched. It makes sense. It has had a real effect on my own thinking. It has been widely acclaimed by The New York Times, The Economist, The Financial Times, The New Yorker, … The criticism I've seen of Piketty are typically shallow and hand-wavy, usually by people who have clearly done no more than skim-read the introduction to Capital. Capital is a giant 500+ page book—every claim it makes is backed up by extraordinary detail. Piketty's main claim is simple: the world economy is completely unbalanced, bringing misery to most of its inhabitance. He explains how this imbalance is the result of Global Capitalism running amok without any checks or balances. Would anyone sane disagree with this premise in a world about to see its first trillionaire? Modern economic thinking is dominated by economists who seem to wilfully misunderstand how capitalism is failing humanity and damaging the planet. They seem scared to point out the obvious fact that in a world of trillionaires expecting interest on their capital, their capital will bleed the world dry. Maybe you should read Capital before you dismiss one of the most influential thinkers of the past few decades.

dakiol 2y ago

From the FAQ > In Belgium, for example, we propose that anyone with 1.25 million euros in assets in addition to their main home and business assets should qualify as "ultra-rich". Uh. That’s a very low bar. I was expecting something above 50 to 100 million euros. As a software engineer, I think (I hope) to reach that number before retirement… and I wouldn’t consider myself “ultra-rich”. I can only imagine the bar is even lower in other countries.

jamil7 2y ago
If you own your home outright plus have 1.25 M€ in assets you would be considered very well off in all of Europe. I don't exactly know about "ultra-rich" though.
- Rinzler89 2y ago
  Pretty much. If you look at the average wealth of the average German it's just sad. Europeans don't have much wealth and building wealth without inheritance is getting increasingly harder.
  - yodsanklai 2y ago
    More interesting is the median wealth per adult. Several European countries are comparable or above the US for instance. https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult https://en.wikipedia.org/wiki/List_of_countries_by_wealth_pe... I'm a bit surprised to see how low Germany is on the list though.
    - vidarh 2y ago
      Partly there are wealth disparities, but there is also less value in building wealth in systems where your healthcare and pensions are reasonable even if you can. Unless you're dead set on leaving an inheritance, there is far less risk in spending what you can, or e.g. buying annuities that will run down your assets but guarantee you a lifetime income.
    - 2y ago

sandwichmonger 2y ago

[flagged]

sambeau 2y ago
On-Topic: Anything that good hackers would find interesting. That includes more than hacking and startups. If you had to reduce it to a sentence, the answer might be: anything that gratifies one's intellectual curiosity. Off-Topic: Most stories about politics … unless they're evidence of some interesting new phenomenon This passes both tests.
- sandwichmonger 2y ago
  I don't see how wanting to tax the rich is an interesting new phenomenon.
deleted 2y ago
[deleted]
vernon99 2y ago
I know it's hard to imagine but not everybody acts purely in self-interest. I'm also supportive of this, even though I'd be taxed more.

bwb 2y ago

Whats funny is this exempts business assets lol. Just increase the tax on dividends and capital gains in a progressive manner. And be prepared if the economy slows as a result (not up to date on what economists report there). Spain has a wealth tax and their economy is not doing so well. Everyone in Spain shields it by putting it in real estate and putting a business around it. And nobody can sell their business as that opens them to the wealth tax, so you get wage stagnation, and a general economic malaise as zombie companies limp along. Nice flashy website though.

deleted 2y ago
[deleted]
vidarh 2y ago
Norway has a wealth tax too, and the wealth tax applies to your shares as well, so wrapping a business around your holdings at best gives you a discount.
- deleted 2y ago
  [deleted]
- bwb 2y ago
  Does Norway have capital gains? Switzerland also has a wealth tax. It can work in small countries with unique resources or focuses. But they are the few, and Switzerland treats it more like a club with negotiating on the top end.
  - vidarh 2y ago
    Yes, up to 38% (above a threshold, and with heavy deductions for holding an asset long-term) Switzerland is the favored destination for rich Norwegians seeking to avoid Norwegian wealth tax, as it typically ends up far lower - not sure of the specifics.
sandwichmonger 2y ago
[flagged]

deleted 2y ago

[deleted]

sakex 2y ago

According to the article they link[1], the 1% richest is defined as earning more than $109,000 in 2015. So basically, they want to tax the people who already pay the most taxes. Actually rich people having the means to avoid paying taxes altogether, it's the educated middle class that's once again expected to pay for opaque, poorly managed, and unaccountable government programs. Glad I live in Switzerland. [1] https://www.oxfam.org/fr/communiques-presse/les-1-les-plus-riches-sont-responsables-de-deux-fois-plus-demissions-que-la#:~:text=Les%201%20%25%20les%20plus%20riches%20de%20la%20population%20mondiale%20sont,sans%20pr%C3%A9c%C3%A9dent%20d'%C3%A9missions%20polluantes https://www.oxfam.org/fr/communiques-presse/les-1-les-plus-r....

JumpCrisscross 2y ago
> the 1% richest is defined as earning more than $109,000 in 2015 Why are they using a global threshold? What fraction of Europeans does this cover? (How is that distributed?)
- sakex 2y ago
  They don't bother explaining
- sushibowl 2y ago
  They are not. The proposal text itself doesn't mention taxing "the 1% richest" or any threshold at all really. It's quite vague on the specifics: > Firstly, we call on the European Commission to draft a proposal for a directive establishing a European excess wealth tax, based on Article 115 TFEU. In any case, the proposal is for a wealth tax, so income is irrelevant. I think the proposed wealth threshold for taxation is supposed to vary by country.
  - spwa4 2y ago
    The problem with "taxing the rich". If we're talking Bezos, Musk and Gates, that's 3 people. To have any decent amount of extra income for states, they must tax "the 1%", and really "the 10%". And if we're then talking about amounts, everybody will immediately, and rightly, claim that "the 1%" is not a livable wage in X. And they're right. You cannot live in Amsterdam on 66000 EUR per year. I mean, it's probably possible, with a great many compromises, but not really. The problem is: "the 1%" in Europe (EU-27): anything more than 66000 EUR "the 10%" in Europe (EU-27): anything more than 34000 EUR I think these figures are not talking about individual income, but about FAMILY income (both partners). It's EU-27 because it used to be EU-28, and then Brits decided ... So, in the Netherlands, I believe that means more than 80% of the population is in "the 10%" of Europe and almost 60% of the population is in "the 1%" of Europe. I doubt even Dutch communists would support this tax.

JumpCrisscross 2y ago

The proposal is to give the Commission the power to enact a direct wealth tax and fund green things? No numbers? Really? So presumably, every EU nation’s tax office would furnish some EU commissar with everyone’s wealth? Which they would be in charge of measuring? (Presumably everyone. Because if it’s only everyone above a certain wealth, there are games to be played with how wealth is counted and who does the counting at the national level.) Also, is this subject to any single nation vetoing it? EDIT: Never mind, this exempts business assets, it’s a total farce.

gatinsama 2y ago

Why not just ask for a more progressive tax system instead of trying to instill class warfare? Sounds commie to me.

tjpnz 2y ago
Because that's not going to achieve anything. If you're rich you already structure your affairs to minimize your income tax exposure.

jcfrei 2y ago

While I'm a fierce proponent of wealth taxes, efforts like this one will hurt finances of the EU and the middle class more. Only focusing on the EU means the really rich will just move their assets abroad to avoid taxes. Efforts like these need to be enacted on an OECD level and first focus on the $100M+ crowd at a low tax rate. Keeping expectations for massive social impacts low and making sure all loopholes and issues are closed before moving to broader wealth taxes - otherwise the populists will claim failure after a few years (populists backed by rich donors) and call for abandonment of wealth taxes - so they get some peace for the next 50 years. Equally important we also need to be clever how to implement this tax collection. The ideal setup is a form of sovereign wealth fund, where individuals that need to pay the tax can loan out shares of their company. The issue for lots of very rich people is that they are not liquid enough to fund these taxes. The solution is to allow tax collection by giving these individuals the opportunity to deposit shares of their company as collateral at a wealth fund - giving the fund access to dividend payouts (those need to be tax free) that then cover the required taxation. That way owners of family businesses can keep ownership of their companies and still pay wealth taxes.

maxrecursion 2y ago
That's a good idea for how the ultra rich can pay taxes without forcing them to liquidate stock, and at least addresses the core of the problem. But if the stock "shared" with the tax collector paid enough in dividends to cover the taxes, couldn't they just pay the taxes with the dividends to begin with? How does sharing the stock help? Wouldn't the tax collector need to liquidate the stock to get any actually value from it?
- lhpz 2y ago
  A stock retains value even without producing dividends. Allowing wealth tax payments in the form of stock, rather than cash, addresses the liquidity issue, especially for large family-owned companies. The challenge lies in accurately valuing the stock for private companies, but that's where finance experts come in ! Furthermore, an agreement between the taxpayer and the wealth fund could accompany the transaction, including terms like holding the stock for a specified number of years, buyback preferences, or limited voting rights. At a discount on the stock price. Given the financial and legal complexities, as well as the challenges in standardizing the process, this would only apply to payments of a highly substantial amount. But one could argue that these individuals are no longer equal to others in terms of their tax obligations, as they have some ability to negotiate to a certain extent. That's probably the main problem. Just thinking out loud !

thih9 2y ago

There is an example for Belgium, is there a list with values for other countries? > The criteria for defining an "ultra-rich" should vary from one EU country to another, due to the economic, fiscal and social differences between member states. In Belgium, for example, we propose that anyone with 1.25 million euros in assets in addition to their main home and business assets should qualify as "ultra-rich".

rglullis 2y ago

I guess what happened in France with Hollande was not enough of a lesson? Anyway, I will repeat: don't tax the rich because of the capital they have to control the corporations, insult get rid of corporations entirely. Make it so that: - companies must be limited to a certain size (on the order of 250) - no individual can work in more than one organization - individual contractors dedicating more than 30% of their time to any specific company should count towards the cap of the hiring entity. Concentration of wealth is only a problem because of the power that gives them via the corporations they control. Get rid of the corporations and you get rid of the problem. Politically speaking, is a lot easier to sell the idea to both sides of the table, while "end billionaires" is something that only appeals to the left.

JumpCrisscross 2y ago
> Get rid of the corporations and you get rid of the problem Wealth concentration predates corporations. Every country with terrible courts lacks true corporations. See how they organise business. (Hint: it’s family and tribes.)
- rglullis 2y ago
  Wealth concentration happens when you have institutions that grow without checks. Before liberalism, this was Church and State. > Every country with terrible courts lacks true corporations. Define terrible. One could argue that the lobby-dominated system from the US is very far from "good".

newsclues 2y ago

The rich will avoid the bulk of the taxation. Others will pay for these "progressive" wealth transfers. Economic collapse may be the goal.

deleted 2y ago

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tirant 2y ago

It is not only sad that fellow citizens want to impoverish Europeans, but also completely counterproductive, especially in the context of an aging population and struggling pension systems. Here's the thing: European countries already have pension systems based on pay-as-you-go models, where current workers fund retirees. But as the population ages and fewer people are working compared to those retiring, the math just doesn't work anymore. The pension system simply won’t be able to sustain the increasing number of retirees. In this context, citizens need to save and build personal capital to ensure they can retire comfortably. The problem with a wealth tax is that it discourages exactly that: saving and investing. By taxing accumulated wealth, you're punishing those who manage to put money aside for their future. This discourages long-term planning and encourages short-term consumption instead. The irony is that governments should be promoting savings and investments to fill the gap where pension systems will inevitably fall short. A wealth tax sends the opposite message and risks leaving people even more vulnerable when they retire, without the state providing enough, and without citizens having been incentivized to build their own safety net. It's one of those "feels-good-on-paper" policies that ends up hurting the very people it's meant to help by making it harder for them to secure their own financial future.

Ekaros 2y ago

3 weeks to go? I don't think this one is going to pass. And for good reasons it is just really vague in the form that is on the initiative.

DataDaemon 2y ago

We already had communism in part of Europe.

Yizahi 2y ago

We don't need to tax the rich (yet). We need to "tax" fucking offshores. That's where stolen money is flowing from all citizens.

jamil7 2y ago

These people should put their minds toward instrumenting reform across the EU and modernizing decrepit and corrupt state institutions before they start talking about giving these bodies even more tax money to piss away.

indigo0086 2y ago

Doesn't help the "europoor" moniker by aiming so low. Shows bigger issues with Europe than taxing the rich can solve

snapplebobapple 2y ago

This is the exact opposite of what is needed both from a social services funding perspective and a wealth concentration perspective. People look at the rich and are justifiably pissed because they see them holding a ton of power because of control of businesses that have a ton of market power (i.e. oligopolies/monopolies) to abuse via rent seeking. The correct solution to that is more aggressive antitrust enforcement actually breaking up many of these oligopolies, which will cut down on the rent seeking and make the market far more dynamic allowing people with good ideas to grow real competitors more easily. From the social service funding perspective, pretty much every first world country is flush with funding. Their problem is incredible amounts of misuse/abuse/corruption/misallocation. which we should be focusing on fixing. The above plan will just hurt those aspiring to be rich who have much more limited options for hiding their income/wealth from taxes, cementing in the rent seekers already at the top. Any further tax revenue will be going into incredibly inefficient and wasteful spending pipelines and will concentrate more power into those pipelines. It's a lose lose lose for everyone in those countries and everyone in the future.