Comment by pfannkuchen
Comment by pfannkuchen 10 months ago
On taxing assets, I think money is used for too many different things.
If we are talking about people owning yachts or airplanes or fifth houses or whatever, then yes, tax the heck out of those.
However, assets with a dollar valuation are also how we assign control of economic functions, i.e. businesses. Control of an economic function is really, seriously qualitatively different than owning yachts or airplanes. Economic functions operating well or not so well has an enormous impact on the success or failure of a society.
Changing how we assign economic function control is very risky, since there is no way to simulate the outcome.
What do you think about that? Are you including share ownership in the asset tax? If so, do you think this will somehow not alter economic control?
An alternative might be to have a split currency that is not freely exchangeable, where one is for business control and one is for stuff. You can sell your business, hold the business currency for however long and then buy another business or part of a business. But if you want to convert the business currency to stuff currency, at that point you are taxed heavily.
I would be in favor of a separate currency class for land also, for the record.
(Not sure if this has some obvious fatal flaw, I am but an armchair economist.)
A good resource on this is UK campaigner Richard Murphy - http://www.taxresearch.org.uk/Blog/
The basics are it is foolish to try and introduce a wealth tax - ie Bezos is worth 400Bn so we want 40bn now please. It becomes impossible to actually say how much a person owns - it fluctuates, even if they are co-operating fully it’s a fools game.
Yet tax rates are different for different categories - equalise those, and tax people at points of liquidation events - so capital gains is the most obvious.
Other liquidation events is borrowing against assets (the buy,borrow,die idea).
One can fairly easily imagine a minimum floor for all these - say 5 million in any fiscal year or whatever so we focus on where the money really is.
It’s also worth remembering that tax is simply a way of destroying the tokens of resource allocation (money). We want to tax the wealth to remove say X trillion globally. But remove it from the wealthiest who society has decided to give trillions to to handle covid but society thinks probably should not be having such a ratio of control over societies assets
And the implication is some other more destructive event can / will occur to rebalance - for example a massive stock market crash. The idea of “billions wiped off the exchange” is the same as a tax event - it’s just way more destructive and uncontrolled - event th wealthiest would rather t have tax planning than recessions and crashes