A ‘one-time’ wealth tax

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    • #4855
      AvatarMick
      Participant

      Rep Tom Suozzi (D-NY) wants to do a one-time wealth tax on people with $50 mms. or more.  Price tag is 2.5% on estate from $50 mms. to $100 mms., then 5% above $100 mms.

      “One-time.”  Ha.  Ha.  Ha.

      A wealth tax will then hit the $10 mms. and up, then $1 mms. and up.  And it won’t be in place of an income tax (sorry GR).  And it won’t be one-time.

      https://thehill.com/policy/finance/558263-exclusive-democrat-exploring-patriot-tax-on-multimillionaires-wealth

      • This topic was modified 1 month, 2 weeks ago by AvatarMick.
    • #4860
      LegendLegend
      Keymaster

      A one-time wealth tax added to a voluntary income tax.  What a world.

      ____________________________________________________________
      Sic transit gloria mundi (so shut up and get back to work)

    • #4861
      AvatarBeeg_Dawg
      Participant

      “Research provided by Suozzi’s office estimates that such a tax could raise about $450 billion.”

      Paid over 4 years? In total, this won’t even be a belly scratch for Biden’s Budget Busting spending. Certainly is a “nose in the tent” move, and I agree, the push will downward to include a bigger group of “wealthy” taxpayers. Translates into “those who pay taxes will pay more.”

      Own a modest home in Cali? Gee, you get to pay another $50k in taxes! How about a novel approach, like cut spending.

      • #4926
        AvatarMick
        Participant

        [quote quote=4861]“Research provided by Suozzi’s office estimates that such a tax could raise about $450 billion.” Paid over 4 years? In total, this won’t even be a belly scratch for Biden’s Budget Busting spending. Certainly is a “nose in the tent” move, and I agree, the push will downward to include a bigger group of “wealthy” taxpayers. Translates into “those who pay taxes will pay more.” Own a modest home in Cali? Gee, you get to pay another $50k in taxes! How about a novel approach, like cut spending.[/quote]

        Biden is counting on the Left’s collective awful math skills to blunt criticism of his budget and any related deficit.  The $112.5 billion extra revenue annually will vanish quickly compared to his $475 billion spend.

    • #4928
      Genuine RealistGenuine Realist
      Participant

      Absolutely absurd proposal.

      But it is interesting to me that there is growing recognition that there are real problems with the way we define our tax base.

      I wouldn't give you two cents for all your fancy rules if, behind them, they didn't have a little bit of plain, ordinary, everyday kindness - yeah, and a little looking out for the other fella, too.

      • #4929
        LegendLegend
        Keymaster

        Agree w/ GR.

        I am all in for a redefinition of the tax base and for redefinition of tax incentives.  There are so many things that don’t make much sense.  The SALT deduction that Trump’s tax cuts limited is a good example, and cutting it was quite the progressive move, but it pissed off a lot of rich liberals in high tax states.

        The problem is this:  Every tax code “kink” has a reason behind it.  Some are actually good reasons.  The Roth IRA was invented so that the government can get current income taxes while providing people an incentive to save.  Not a bad thing, but then you have Peter Thiel with a $5 billion Roth IRA.  Do you hate the player or the game?  Which is it?

        The mortgage interest subsidy is another good example.  Subsidizing homeownership with tax deductibility of interest makes some sense.  But what compelling interest does the government have in subsidizing purchases of million-dollar homes with jumbo mortgages?

        Wealth taxes, for me, are a questionable animal.  “Wealth” as defined for 90 percent of people is only one of two things… It’s real estate, which is already taxed as a percent of value in almost every jurisdiction, or it is an asset value (think stocks and bonds) based on a valuation of expectation of future payments.  Those payments will be taxed when they are made (actually, double taxed).  Taxing people for paper valuations of financial assets whose intrinsic value may not be in any way near the actual paper value seems…off to me.

        For instance. Elon Musk may be worth Billions at the moment, but he can’t actually cash out the value, so is the value of his Tesla stock really the stated paper value, or some discounted value from that reflecting its illiquidity?

        I won’t even get into trying to tax wealth that’s in the form of jewels, art, and other items with intangible value.

        The wealth tax makes sense on its face (I actually find Piketty’s theory compelling) – Since returns to capital tends to outrun returns to labor and overall GDP growth, capital holders necessarily become more concentrated over time.  Tax the growth of capital and you level the playing field… makes some sense.

        The issue is in valuing the tax base.

         

        ____________________________________________________________
        Sic transit gloria mundi (so shut up and get back to work)

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