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The fairest and easiest to realize wealth tax is on inheritance. It is great to want to give your kids a headstart in the world, it is terrible for them and the

• Terr_ 5mo ago
  > wealth tax is on inheritance As a point on terminology: That's not a really a wealth tax on the accumulated assets at-rest own by the (now eternally-resting) owner, but an income tax on the wealth as it moves to the recipients who didn't have it and are getting a massive gift. It just happens to be a kind of gift/transfer we've decided because of tradition to consider as a special case, where (A) it happens right after a given dies and (B) the giver is frequently but not necessarily related to the recipient.
• SoftTalker 5mo ago
  I would disagree, I think income taxes and inheritance taxes are morally wrong. Earning money to support oneself and family instead of relying on public largesse should not be taxed. Passing the fruits of a lifetime of work to ones heirs so they can continue do productive work instead of relying on public largesse should not be taxed.
  • lazide 5mo ago
    First one makes sense, second one I’m quizzical about. Inheritance taxes tend to only kick in at the 8+ digit range. If anything, taxing that should encourage descendents to do productive work, eh? Since not taxing it, but taxing other things actually discourages it? I can’t imagine how it would result in anyone relying on public largesse either unless they are really terrible with money. In which case a few extra zeros is unlikely to help any?
    • SoftTalker 5mo ago
      I suppose like with many things it's a question of scale. A little is good, more is better, but at some point it may start to have negative consequences.
  • ceejayoz 5mo ago
    > Earning… Inheritance is, notably, not earning it. > continue do productive work That's a pretty bald assertion. Useless nepo babies abound. > relying on public largesse Any chance the existence of a stable, well-educated, high-trust society benefits the children of wealthy people at all?
    • steveBK123 5mo ago
      Yes.. spend enough time amongst the inheritocracy and you'll see the wealth is as often as not wasted on them. There's just too much fun to be had with 0.1% wealth that you didn't have to sacrifice your 20s, 30s (and maybe 40s) to build. Coast at some job with a top 25-50% income and 0.1% inheritance in NYC and live the life.
      • SoftTalker 5mo ago
        So if you're spending your inheritance living the high life, that economic activity benefits a lot of other people. Still a net positive in my view. I get the political power concern, and money = power at a certain point. But I'd rather work on getting money out of politics than putting limits on what people can decide will happen to their assets after they die.
        • ceejayoz 5mo ago
          Sure, and rape helps the therapy industry. https://en.wikipedia.org/wiki/Parable_of_the_broken_window https://en.wikipedia.org/wiki/Parable_of_the_broken_window
          • kjshsh123 5mo ago
            Bastiat was opposed to inheritance taxes. He wrote about this in Economic Harmonies. I think he'd call the connection you're trying to make a stretch
            • selfhoster1312 5mo ago
  • kelseyfrog 5mo ago
    And I think that inheritance, while a natural desire, is morally wrong. It's an example that desires aren't always congruent with morality. People will go to great lengths to justify their conclusion.
    • Terr_ 5mo ago
      > while a natural desire Or look at monarchies and titles of nobility. In the past direct inheritance of political assets was common, and acting on that natural desire, the people involve claimed that parents deserved to direct what they (and their ancestors) had accumulated on to the next generation of their own family. Yet nowadays most countries and people have decided it is immoral, and they also took steps to make common forms of it extremely illegal. My point is that economic inheritance today is just as much a social-construct as political inheritance was then. It exists because we permit it to exist, don't be fooled by anyone claiming it's an intrinsic law of the universe or a divine mandate by god that must be obeyed.
    • orangecat 5mo ago
      Are gifts morally wrong? If I'm near death is it wrong for to give my assets to my children beforehand, or does it only become immoral if done via a will?
      • kelseyfrog 5mo ago
        Yes. I get the desire, but gifts of wealth when done at scale contribute to the destruction of society. Quantity is a quality all its own.
      • Terr_ 5mo ago
        > Are gifts morally wrong? If we're going to talk about morality, I think we need to talk about the government as one of the moral actors. Imagine this scenario, exaggerated to make a point: 1. Alice receives $X. It's from her boss, for laboring in the mines every day. Government man says: "Give me 20% to pay for the shared roads, or you go to jail." 2. Bob receives $X. It's from his parents, for doing nothing other than being born related to them. Government man says: "Gee, I just can't do anything here, I guess I'll have to shake down Alice even harder next time." Isn't there something off about the morality of Government Man's choices?
  • gruez 5mo ago
    >I would disagree, I think income taxes and inheritance taxes are morally wrong. So what taxes aren't "morally wrong"?
    • WalterBright 5mo ago
      > So what taxes aren't "morally wrong"? Taxes on somebody else.
      • deleted 4mo ago
        [deleted]
    • SoftTalker 5mo ago
      Property taxes on real property or possibly land value tax (it's a limited resource, at least in places where people want to live, and requires a lot of public infrastructure to support its value there). Tariffs, various usage taxes and fees. Need a mechanism to address the regressiveness of some of this but that's an implementation detail.
      • sporadicism 5mo ago
        How is dynastic wealth not immoral?
    • OkayPhysicist 5mo ago
      Their take on inheritance taxes is insane, but I tend to agree that income taxes are immoral. Corporations get taxed on profits: If OkayPhysicist, Inc. spends $200 to make $300, it would be taxed some fraction of $100. Individuals, on the other hand, get taxed on revenue. It doesn't matter if it costs me $4000 in rent, groceries, transportation, etc., to make $6000, I'm getting taxed on that full $6000. Capital gains taxes, on the other hand, are completely moral, and should be much, much higher. Capital investment benefits enormously from the State protecting their property "rights" (you don't need to hire a private army to prevent the workers from just deciding to run your factory for their own benefit, that's what the cops are for), and at a minimum the state would be justified in collecting that dividend for itself. Bootlickers and profession bootlickers (i.e., economists) would complain that a high capital gains tax disincentives investment, but as long as the value of investment is positive, that is, outpacing inflation, it makes zero sense to let your money languish in a Scrooge McDuck pile rather than get some value out of it.
  • InsideOutSanta 5mo ago
    Not taxing inheritance is morally wrong because it supports generational wealth and inequality.
  • selfhoster1312 5mo ago
    I would disagree. How else would you pay for the schools, roads and hospitals so that you and your heirs can "do productive work"? I mean i could imagine alternatives, but none that's compatible with a capitalist system.
  • arw0n 4mo ago
    There's a difference in thought here so fundamental that it is hard to argue about details without addressing it first: You believe the individual comes first, what it produces is taxes hy the external construct of the state, which takes from what the individual truly earns. But the individual would be a subsistence farmer at best without society supporting it, hardly worth taxing. In reality millionaires are only possible with a large state and societal network around them. Wealth is societies gift, and its right to take back.
• koliber 5mo ago
  The problems with inheritance tax is that they can be avoided through trust structures and insurance schemes. In theory it's a good tax, but in practice many wealthy people figured out how not to pay it.
  • ryandrake 5mo ago
    Those schemes are also human-created though, and can be human-fixed. I've never really understood the arguments that go like: "This regulation won't work because the people it targets will avoid it through loopholes and other schemes." Well, get rid of the loopholes and schemes, then! Granted, this requires lawmakers to explore more of the "exploit space" around their proposed regulations, but I don't think that's really asking a lot of them.
    • ycdeebs 5mo ago
      The only way to get rid of tax avoidance is to simply tax transactions, every time, for every person, on every transaction. “Oh, that’s regressive” they will say. Make it small per transaction. A rich person spending 100x what a normal person spends will pay 100x as much tax. A billionaire spending 10000x what a normal person spends will pay 10000x as much. And they will also be taxed if they borrow money (that’s a transaction) against assets so they don’t have to sell them. And when someone inherits, that’s also a transaction. Money moves from one person to another. So that same tax applies.
      • bonsai_spool 5mo ago
        > And when someone inherits, that’s also a transaction. Money moves from one person to another. So that same tax applies. This is a big one—we continually decrease the estate tax, which is already waived until you get to 'fuck-you-money' at the federal level (around $11 M)
      • abenga 5mo ago
        If your wealth/income increases x1000, their spending will not increase a thousand-fold. It's not like you can eat a thousand burgers in a day. All this leads to is poorer people paying a larger proportion of their income as taxes than the richer.
• gopalv 5mo ago
  > It is great to want to give your kids a headstart in the world I might live till 72, my kids will be my age right now when they hit inheritance instead. That's not a headstart.
• WalterBright 5mo ago
  The federal estate tax is 40%. NYC adds in another 16%.
  • Terr_ 5mo ago
    > The federal estate tax is 40% It's misleading to cite that since it basically never happens. The tax doesn't even come into the picture for fortunes below $30 million dollars (for two parents), and the rest of the time it averages ~14%. https://www.cbpp.org/research/federal-tax/the-federal-estate-tax https://www.cbpp.org/research/federal-tax/the-federal-estate...
    • WalterBright 5mo ago
      Why not repeal it, then?
      • Terr_ 5mo ago
        Is this perhaps some sort of badly-signaled satire, or a comment mis-submitted to the wrong thread? I cannot understand what though-process led you to suggest repealing "it", whether that means the entire tax or whether it means reducing the number of brackets.
        • WalterBright 5mo ago
          > it basically never happens Why have a tax that never happens?
          • Terr_ 5mo ago
            No, I'm saying the tax basically never takes 40% of the estate assets that are being gifted to recipients. That 40% is just one number in a larger equation, and it's wrong to use it out of context in a way that makes the policy seem harsher/scarier than it really is. However it also true that 99% of the time the estate tax is $0, but that just tells you 99% of Americans die without being that rich. It doesn't mean that piece of the system is not effective or necessary at doing a job. If we had no estate tax, that would create a massive loophole people would abuse so that other taxes stop working as intended. It's like how the vast majority of cars will not hit the railing that stands between them and a deadly plunge off the edge of the cliff... but we still need to keep it for when it matters.
• dirtikiti 5mo ago
  So you want to tax something that has already been taxed throughout the course of someone's life, just because they want to give it to their kids? The only tax that is fair to everyone is a sales tax.
  • jonathanlydall 5mo ago
    I live in South Africa where we have 15% VAT. When I was little and playing SimCity 2000 I looked at the tax rates for the city and noticed that the sales tax rate was like 2%, and based on our 14% VAT at the time, it seemed super low to me so I upped it to 12% and was surprised at how unhappy the citizens were. This gave me the impression that Americans wouldn’t be happy with a significant sales tax, or perhaps this was a city sales tax on an existing state sales tax, which yes, would be outrageous, or maybe Americans get taxed in some other way which makes up for our VAT. Anyway, I look back and chuckle at my own lack of knowledge at the time.
    • dirtikiti 5mo ago
      I would love a VAT tax instead of the never ending stream of taxes we pay on everything else. Americans are stupid. They see a higher tax on an iPhone they don't need, they will cry about it. But they pay more at the end of the year on income tax, property tax, car registration, etc., they could care less. Most Americans don't even look at their pay stub, and are more than happy to overpay their income taxes every paycheck so they get a bigger tax return at the end of the year. They don't realize that money was theirs to begin with. They complain about not being able to become wealthy while they give the government an interest free loan, when they could be investing that money and earning on it.
  • InsideOutSanta 5mo ago
    All of the money has already been taxed countless times.
• socalgal2 5mo ago
  Just curious what you think the correct solution is? You're rich, you have a kid, you die when the kid is 2yrs old. So they get nothing? 12? 22? 32?. Is there some "correct" number? If you're raising them in some $100m home do they get booted out and put in a tenement? On the other hand, most people die closer to 75-80 and their kids are 50+. Leaving inheritance to them isn't really spoiling them as they are alread adults with established lives.
  • Manuel_D 5mo ago
    In the US, the inheritance taxes don't kick in until $15M ($30M for married couples). Even at 2 years old, a child can inherit more money than most people will make in their lifetime before a dime is paid to the IRS.
    • technothrasher 5mo ago
      Federal inheritance taxes. There are also state inheritance taxes in many states. NY, for example, kicks in at ~$7M. MA kicks in at $2M.
      • buellerbueller 5mo ago
        poor little multimillionaire :( my heart breaks for their 90th percentile wealth.
      • ceejayoz 5mo ago
        > NY, for example, kicks in at ~$7M. Won't someone think of the children? The very wealthy children paying a 3% marginal tax rate on some of their multi-million dollar inheritance?
        • steveBK123 5mo ago
          Honestly my experience with most of these kids is they are so innumerate they won't even notice the tax
    • 5mo ago
• kjshsh123 5mo ago
  It's really not the easiest. You have to prevent gifting things at a lower tax rate while alive. That means it comes bundled with income tax or gift tax implications. Fairest? I mean, land value tax is fair. So are Pigouvian taxes. In fact they're arguable more than fair. Not having these taxes is arguably unfair. Who deserves ownership of natural resources or to inflict negative externalities on others? Taking things someone earned through labour and not letting them give it to who they want isn't very fair.
  • hungryhobbit 5mo ago
    I think to everyone but a nepo baby it's clear that the children of the rich don't deserve their wealth.
    • hungryhobbit 5mo ago
      Wow, someone downvoted me? The definition of the word "deserve" is: > To deserve means to be worthy of, entitled to, or to have a valid claim to a reward, punishment, or treatment based on your actions, qualities, or circumstances So you genuinely believe that nepo babies, despite not taking actions or creating any circumstances to earn their wealth .... nevertheless deserve to have it anyway?
      • ycdeebs 5mo ago
        I flip that around. People who have worked, earned, invested, AND paid taxes their whole life “deserve” to be able to give it to whoever they want.
      • kjshsh123 5mo ago
        It's less that about the recipient deserving to receive it, and more about the giver deserving to give it.
• ExoticPearTree 5mo ago
  > It is great to want to give your kids a head start in the world, it is terrible for them and the people around them to set them up for life. How is it terrible for my kids to not have to break their back like I did to build the wealth I'm looking to pass on to them after I die? Why should they go through the same struggles that I did? It is up to them to squander it or transform it into even more wealth to pass it down to their children and so on. Ideally the former, but sometimes what parents dream for their children does not always come to pass.
  • Galanwe 5mo ago
    Inheritance tax in practice is implemented above a certain threshold. There is nothing wrong with striving to give a heads up in life to your kids, on the contrary, it's a core, visceral instinct of parents to do so, and removing that would be alienating. There is a certain level of wealth though, where the "heads up" transforms to an unstoppable compounding lever. France for instance has a progressive inheritance tax (starting at 5%, up to 45%), triggered for children inheriting at 100k€ per parent. In practice, 50% of the population inherits <70k€. Also, the proposed Zucman tax in France for instance is triggered starting at 100M€ wealth. At these levels, a mere 2% risk free investment yields 2M€ annual income, this is enough to both compound and enjoy a very luxurious lifestyle. This level of wealth is unstoppably compounding, and that is why it is proposed to tax it. If you don't, well you end up with a US situation, where disproportionate wealth (and thus power, influence) end up in the hands of random citizens with their own agendas, possibly (likely) orthogonal to the interests of the majority.
    • selfhoster1312 5mo ago
      Unless i've misunderstood the text, the Zucman tax proposed a minimum 2% tax rate for the >100M€ rich bastards who don't already pay 2% of their income in taxes, not an additional 2% on top of existing taxes.
  • irishcoffee 5mo ago
    My grandparents didn't pass away until my folks were in their 60s, my remaining parent most likely won't die until I'm in my 60s. I also went to give my children the world, but giving them a few million when they're about to retire doesn't really do much. parents wanting to support their kids should do things like pay for college or a trade school, cover their grandkids daycare costs, help them buy their first home. We charge young parents so much money they don't have, and, much like covid, only seem to cater to old people for whatever reason. I guess because they have the money.