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Including capital gains in regular income taxes _would_ be a tax on wealth, though, wouldn't it? Certainly more so than it is now. To avoid discouraging saving
by 100k 13y ago
Including capital gains in regular income taxes _would_ be a tax on wealth, though, wouldn't it? Certainly more so than it is now.
To avoid discouraging savings, the wealth tax could be progressive. The tax on the average citizen's savings is negligible but rentiers pay a substantial portion.
I think an inheritance tax is especially important to prevent the formation of generational wealth.
- ericd 13y agoIt would only be a tax on capital gains, not on the principal. And philosophically, why should investment income be treated any differently than income gotten due to effort? Property tax is a sort of wealth tax. It goes to fund local services that the occupants of that house presumably consume, though.
- dllthomas 13y agoInflation + capital gains tax => tax on principle. The actual rate would be low, though.
- bzbarsky 13y agoIt's an effective tax on principal if you tax nominal capital gains. If you want it to be a tax on actual "income" in real terms it needs to be a tax on real (i.e. inflation adjusted) capital gains. How much of a tax on principal it is depends on the inflation rate, of course; right now it's not much of one, but back in the 70s it would have been a bigger deal.
- ericd 13y agoYou're right, and I think the inflationary portion should be completely tax exempt.