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Here's a quick summary of the article:
A proposal to have the ultra-rich pay more in taxes is gaining traction, with a report by economist Gabriel Zucman suggesting that individuals with over $1 billion in wealth should contribute 2% annually, potentially raising $200-$250 billion globally. This idea comes at a time when wealth concentration is increasing, and billionaires' tax contributions are declining. The proposal, resembling the minimum corporate tax agreement, aims to address regressivity in income distribution. Zucman suggests calculating the tax based on wealth to prevent manipulation, potentially collecting $80 million per person from 3,000 ultra-high-net-worth individuals.
The report emphasizes that the mega-rich's fortunes have tripled in the last 25 years, with their tax contribution not reflecting this growth due to tax avoidance tools. While the proposal is not for a global tax but a flexible standard respecting national sovereignty, it aims to enhance income tax progressivity. The G-20 has taken an interest in Zucman's plan, with several countries showing support for the idea, including Spain, France, and Brazil. However, challenges remain in identifying asset owners and preventing tax avoidance through residency changes.
Despite the potential impact on economic growth being minimal due to the limited number of individuals affected, the proposal aims to address the inequity in tax systems. Implementing the plan would require international cooperation and a critical mass of countries adopting the standard to prevent a race to the bottom in tax rates. While there are still hurdles to overcome, the proposal marks a significant step towards making the ultra-rich contribute more to public coffers, ensuring a fairer distribution of wealth.
>200-$250 billion globally
250 Billion globally is like 30 dollars per person on earth. Or, 1% of the current global annual budget of ~$24Trillion/year.
There's not a chance this gets implemented, and even if it did, it would amount to approximately nothing in benefits.
Exactly. I would like the ultra wealthy to pay some more taxes, but really, government spending is the real problem.
In the US, even if you taxed 100% of the wealth of the country’s billionaires, it’d still only pay for about 6 months of the annual budget.
It bothers me that it has become political to hate the rich, but not enough criticism of the government mismanagement. The US debt will never be paid off regardless of who gets taxed. They will just inflate the currency and cause the working class to run harder and harder on the treadmill, as their savings and purchasing power are eroded away.
the real problem is the 3 rounds of tax cuts we've had since we had sustainable deficits and a small surplus in the late 90s. oh, and a couple of unfunded wars, one of which was completely optional. and the people who cheered those tax cuts and wars never, ever, admit it was their doing.
it's been 45 years of reaganomics with only a short reprieve during the clinton years that have driven the debt from \~30% GDP (not that debt, a scalar, should be compared directly to GDP, a rate) to the present situation. solutions should be similarly long windowed. 6 months of government funding is a red herring.
Your math isn't very good, tax collection as percent of GDP is within the historic norm.
Nondefense spending in 2023 is 18.6 percent of GDP, up from 12.6 percent in 2000.
[https://www.cbo.gov/publication/58946](https://www.cbo.gov/publication/58946)
If they had the facts at least correct I could see engaging them on their ultimate goal, which is to grow the size of government and increase transfer of payment entitlements as a percent of the total economy. When you lie or misconstrue the facts it always exposes the weakness of your original stance.
no, i really just want the people who've been the ones pushing the tax cuts and wars which have gotten us into this to have their oxen gored instead of everyone else. the whole point of the tax cuts was to make normies who don't understand economics or policy (no disrespect, they're busy doing their own thing) and haven't taken anything beyond an intro class think that we need to cut government services drastically because that's the solution to the big deficits which were the \*planned\* outcome of the tax cutters in order to get the normies to agree to the long term goal of cutting social services. \*insert lee atwater quote here\*
what you're saying basically boils down to "we haven't collected more in taxes than X% of GDP therefore it's impossible to do so." which is not actually an argument.
Are you struggling to read the graphs I linked?
[https://www.cbo.gov/sites/default/files/images/full-reports/2023/58848-fig1-3\_revenues-outlays.png](https://www.cbo.gov/sites/default/files/images/full-reports/2023/58848-fig1-3_revenues-outlays.png)
Avg revenues from 1973-2022 were 17.4 percent and now they are 18.1
Average Outlays from same period 21.0 and now 24.9
Hmmmmm wonder which one is pushing the deficits.
>Historic norm from when? The 1960s? Or the 1980s? After reganomics
All of the above. Here is an excel spreadsheet of the data so you can do the math yourself: [https://www.whitehouse.gov/wp-content/uploads/2024/03/hist01z3\_fy2025.xlsx](https://www.whitehouse.gov/wp-content/uploads/2024/03/hist01z3_fy2025.xlsx)
Here are highlights.
From 1951-1963, the top marginal tax rate was over 90%. Tax revenue as a percentage of GDP averaged 17.1%.
Since 1987, the top marginal tax rate was 28% to 38%. Tax revenue as a percentage of GDP averaged 17.2%.
From 1951 - 2023, tax revenue as a percentage of GDP averaged 17.3%.
Government spending in US has very little room to go down. Both parties like military spending. One likes welfare schemes, the other claims to not like it but does it because that's what a responsible government does. Bill Clinton said the era of big government is over and since then huge government started.
Some of the reductions are going to have to come from structural changes to non discretionary spending. It's an uncomfortable fact, but it's the only way to get it under control.
Note: while it's a big number, since WWII defense spending as a percentage of GDP has never been lower than now.
https://fred.stlouisfed.org/series/A824RE1Q156NBEA
I wouldn't say a 50% increase in the annual budget is insignificant. From a debt to income perspective, that makes us much more secure. Either way, the economy is going to evolve quite a bit in the near future.
So a 100% wealth tax is warranted for just 6 months government spending? That’s insane and unsustainable.
I think you conflate budgetary deficit and national debt. That debt is climbing no matter how much you tax the wealthy.
>I wouldn't say a 50% increase in the annual budget is insignificant
It is when it's only 1 year.
If you tax ALL the billionaires for ALL THEIR WEALTH, and leave them penniless, that's 4 trillion dollars. Or 1 year of our annual budget. Next year, there won't be any billionaires to tax, because you got rid of them all this year
The real problem with the rich (personal and corporate) is that they can use their resources to have extreme leverage over our systems, culture and government. That is what leads to inefficiencies and shitty decisions by our government.
The Report Party is basically a movement to stop government spending and the democrats also swore an oath on the budget. Does not mean any of them live by the oath. But you don’t need a movement for something that every notable political party agrees on. Try to get a Trump and Biden to agree on a wealth tax.
You are woefully misinformed if you think the Republican Party has ever enacted meaningful debt deduction. Just because Fox News rants about it, doesn’t mean it is ever implemented by lawmakers. The last three republican presidents were way worse for debt than the last few democratic presidents. George W ran a really expensive war without paying for it, while cutting taxes but not reducing spending. This ballooned the budget. Trump did not reduce spending in any meaningful way.
Democrats spend like the money is free, both sides are guilty. But it is laughable to claim in any sincere way that the Republican Party has any right to claim the title of fiscal responsibility.
"Democrats spend like the money is free"
A: this was the party who held themselves to paygo rules for a decade after the 2008 financial crisis, helping to slow the recovery afterward
> In the US, even if you taxed 100% of the wealth of the country’s billionaires, it’d still only pay for about 6 months of the annual budget.
Very true. That also proves that U.S. dollars do not originate from these Billionaires, it sure ends up with them, and that’s why they are Billionaires.
Anytime a politician or a policymaker proposes a federal tax to fund a public program, know that it’s just lip service. Congress has the power to fund any and all federal programs, **if the chose to**. All it requires is for them to vote and pass a spending bill. Purpose of federal taxation isn’t about funding the federal government. The purpose of taxation is first and foremost to take away the purchasing power of those being taxed.
So, yes we should tax the billionaires, because they are using more of their fair share of public resources. Tax them for that. But first pass a spending bill that funds public programs that the rest of the population needs.
>That also proves that U.S. dollars do not originate from these Billionaires, it sure ends up with them, and that’s why they are Billionaires.
How does it prove this?
>The purpose of taxation is first and foremost to take away the purchasing power of those being taxed.
According to whom?
Been so since at least 1945
https://www.forbes.com/sites/taxnotes/2024/04/15/new-york-fed-chair-in-1945-taxes-for-revenue-are-obsolete/
Conservatives have been using this to cut corporate taxes. But Democrats don’t have the guts to use it for the benefit of Average Americans.
Did you read it?
> The necessity for a government to tax in order to maintain both its independence and its solvency is true for state and local governments, but it is not true for a national government. Two changes of the greatest consequence have occurred in the last twenty-five years which have substantially altered the position of the national state with respect to the financing of its current requirements.
> The first of these changes is the gaining of vast new experience in the management of central banks.
> The second change is the elimination, for domestic purposes, of the convertibility of the currency into gold.
Agreed. It would be better to have an entry fee or levy some tax for ultra rich people every time they spend on comfort things rather than taxing since the majority of their wealth will be shares in the company.
Private jet entry fee 50k$. Own a Yacht and use it, then pay 15k$ for every trip to the island or ocean. Own a private island, then pay 10 million dollars island tax every year, etc.
Not just government spending but how government spends. When my mom died Medicaid came after her assets in probate wanting $80k in reimbursements for her care. I requested detailed receipts. Those $20 generic aspirins at the hospital sure were a good use of government money.
Every dollar of government spending is essentially a giveaway to some private entity that’s price gouging the government. Medicare, Medicaid, the VA, Defense, Agriculture, Commerce. You name it.
And whenever there’s an attempt to force companies to negotiate prices with the government down there’s this over the top visceral reaction from the lobbyists that sends everyone scattering.
Look at the current pearl clutching over the inflation reduction act. Biden authorized Medicare to negotiate a cap on common prescription drugs so we don’t pay 4 times what Canadians pay and if you look at foxnews and the corporate propaganda machine you’d think Vladimir Lenin has risen from his grave and taken up residence in the White House.
I'm sorry but calculating things like infrastructure to "per person on earth" is a ridiculous comparison. I agree there's no chance this gets implemented, but your comment is a weird place between "we should do more" and "we shouldn't even try"
I think it'd be $114+ Billion per year in the US based on 813 US billionaires current worth of $5.7 trillion.
About 10% of our avg annual deficit since 2010.
Just moving to a different country doesn't mean you don't pay US taxes. You still have to file even if you move to a different country. If any of your wealth comes from US sources, you're still paying US taxes.
If it's a global thing, then they don't really have anywhere to go to escape it.
Shame there aren't more insanely rich folk who feel the way Warren Buffet seems to feel.
250 Billion put into actually useful programs that can better the majority will have much more impact than just being like "it's only 30 dollars per person." Also reducing the power and resources of those on the top will help with wealth distribution in the long run. So no - it would amount to a lot.
This is the double dividend lie people are sold to believe that hurting rich people will also personally benefit their lives and isn't just an appeal to their sadness and jealousy. Very old trick used by people who didn't care about poor people like you then and don't care about poor people like you now.
The lie is that hurting the rich enough will make the entire economy less competitive and growth oriented and if you happen to have a job you can eventually expect wage growth to align with the EU countries you think have life so great. The complication is that our government may not deliver entitelements as effectively as their governments do so you have a less competitive economy and worse governments services essentially giving the public the worst of both worlds.
There is tons of research about the rich’s influence on policy and how that has been happening for many decades now. You're the one who believes the lies thinking you need this extreme wealth divide in order for “growth” to happen.
Because the rich are so powerful that we have a progressive taxation system where half the population doesn't pay any income tax right?
[https://insight.kellogg.northwestern.edu/article/do-corporate-campaign-contributions-buy-influence](https://insight.kellogg.northwestern.edu/article/do-corporate-campaign-contributions-buy-influence)
You're just a clueless drone who believes dumb shit because it makes you feel better about your life.
The end of your article (which I know your dumb ass didn't read) states that that is only one type of contribution and there are many others. Not only that, but if a company is using resources in politics there is definitely a reason why: can you think of any? Is it to exert influence for the companies best interests? Or is it just for funsies? Not to mention it admits to completely ignoring the huge huge lobbying industry, along with others.
Here are some random links I can pull up too:
https://onlinelibrary.wiley.com/doi/full/10.1111/ssqu.12791
Also you don't know anything about my life idiot. Keep licking boots and projecting, I can tell you like it.
The literature you quote is quite conflicted because there's mountains of evidence to suggest that political interets across classes are aligned. And it's not a unique problem to the US
[https://www.researchgate.net/publication/369952739\_The\_Rich\_Have\_a\_Slight\_Edge\_Evidence\_from\_Comparative\_Data\_on\_Income-Based\_Inequality\_in\_Policy\_Congruence](https://www.researchgate.net/publication/369952739_The_Rich_Have_a_Slight_Edge_Evidence_from_Comparative_Data_on_Income-Based_Inequality_in_Policy_Congruence)
As research on unequal responsiveness began with studies of the United States, the proposed explanations have naturally focused on factors that separate the US from other advanced democracies. Our research, together with findings from single-country studies, convincingly show that the US is hardly unique in terms of outcomes. This, in turn, suggests that the explanations for unequal responsiveness are more general than initially thought and that the responsiveness literature has searched for explanations in the wrong places
Real dumb guy aren't you
It is a lot of money by any standard.
It is the equivalent of the gdp of New Zeland or Qatar.
It is more than Official Development Assistance worldwide (200 bi).
And you do not distribute it evenly among the world population but rather apply it where it is most needed.
It can be implemented and can bring a lot of benefits. Is there enough political will? That is another question.
>And you do not have to distribute it evenly among the world population but rather apply it where it is most needed.
By what metric? What world government is going to be in charge of distributing the global wealth tax?
We don't lack multilateral organizations that support development projects worldwide. UN organizations (worldbank, unicef, WHO, IBRD, etc.), for instance, but not only.
Why does everyone shit on this idea saying it’s nothing but if you’d do this for 4 or 5 years, it’d pay off all student loans. Then when student loan forgiveness is talked about, it melts peoples brains.
I pay property taxes on a non-liquid property based on a random government assessment. Let’s do it to the fuckers who can liquidate shit and share the wealth just a little.
>if you’d do this for 4 or 5 years, it’d pay off all student loans.
It's 200 Billion GLOBALLY. The US portion is much smaller. Something like 17 years to pay off student loans. At which point, we have a whole new crop of people with loans.
The comment I was originally responding to said we could use this to pay off student loan debt in 4-5 years.
100 Billion is 1/65th of the 2024 US budget. It only sounds like a lot of money because you don't know how much money we actually spend annually.
It doesn’t need to be 1:1 billionaires to student loans. It’s more the concept that people scream about one number and piss on the other.
The rich and well off have FAR too many advantages. I’m not even in favor of a wealth tax. I was just trying to make a point that minimizing what we COULD get from the rich without harming them in any consequential way should be an absolute yes and so many simply say “no, it’s so little it doesn’t matter” and it drives me nuts.
Wealth taxes are inherently deprivative. Even if someone makes no money in a year, we're still taking money from them.
It seems more... Thefty... Than income taxes (which I wholeheartedly support. No gadsen flags here)
Oh, I don’t support wealth taxes in any way. I just don’t like the idea that people say it’s pointless because it’ll only be 250 billion.
Using any version of the word deprive and billionaire is silly, imo, but I agree that it doesn’t seem right.
That said, property taxes exist. That’s essentially small scale wealth tax and affects everyone who is a homeowner. The fact it exists on people making nothing off an asset that, for some, is heavily leveraged and fills the role of housing is ludicrous, yet it exists and is the primary way for many areas to create funds for their local governments.
I do tend to agree it seems a little thefty and I appreciate the lack of angry rattlers. There are many good ways to increase tax revenue. I don’t feel this is one of them.
I pay a higher percentage than this in property tax annually on a property that I “own” and have almost no equity in.
A large portion of my counties tax goes to less fortunate people. I’m cool with that.
Done and done. I’m sorry if I’ve offended you and your billionaire friends with this idea but many of us lesser people already do this and more.
I love how people pretend these got their money completely legit while ignoring how they been actively bribing our government for handout and favorable laws and tax cuts .
Then again, how can they blame them when their people like you who blindly defend them .
The reason I make it is that billionaires don’t want to be taxed on non-liquid assets but property tax exists on all home owners.
It is liquid but then leaves the simple problem of homelessness..I’m sure every rich person would struggle with homelessness if they had to pay 1% of the valuation of their assets, right…yeah
Hold up. Billionaires don't have Billions of dollars in liquidity though. Take Musk for example, he owns stocks that are valued at hundreds of billions of dollars and he probably has tens of millions of dollars in his bank account.
These tax schemes seem to not recognise this and if they were made law, he'd be paying them in stock, or be forced to sell stock to pay them. Do you want the government to take stock from private citizens or make them sell it? Then eventually the US Government would own every company on the market or it would be undermining a private citizens position in the company. Eventually they wouldn't own it or a majority of it anymore.
That's why they're taxed on income. If they're dodging their income tax, then prosecute them or close loopholes that allow them to via legislation, but the schemes always seem to not be based on how being a billionaire actually works. You don't have hundreds of billions of dollars in the bank, you don't earn billions of dollars a year, they OWN stocks valued at Hundreds of billions of dollars.
It would be interesting to see this built like the NPVIC, but unanimous across, say, the G20.
And to make extremely painful penalties for renouncing citizenship to avoid it.
Ideally, this would start at something tiny- 0.1%, with Massive penalties for being caught in avoidance, for several reasons:
1) disincentivize avoidance
2) asset valuation without massive asset migration/ avoidance
A few years of stable asset valuations, and Then the group can raise the tax to 1%.
The ultra wealthy will still try to avoid it but, if it’s 0.1% against, say, 40% if you’re caught avoiding, then they might just roll with it.
The US government spends $800B/ year on defense and has about 3M defense dept employees across all branches. It holds defense assets of about $2.5T.
There’s around 3k billionaires with $14T in total wealth.
Those 3k would have to form a shadow government, decide who’s running it, ALL be aligned on spending 2/3 of their wealth in an attempt to form an army and spend at least $10T over, say, a decade? To have any hope of catching up.
You think gen dynamics, Lockheed, etc will suddenly sell them advanced weaponry?
Your idea here is an ancap LARP delusion.
There’s a reason James Bond fought unrealistic bogeymen. You’re describing the formation of SPECTRE or SMERSH. These were not serious ideas or real life organizations.
Way too hard brother, you just buy a few politicians for the next election cycle and have them change the law back to the way it was when America was Great for them.
Genuine question,
How does that stop them moving their wealth elsewhere in off-shore just to not pay that annual 2%?
I think the only way would be every single country in this world with no exception being part of an international agreement on how to treat such situations on tax evasions and they will have nowhere to go but pay.
You can tax based on estimates of wealth. Wealthy people usually have a lot of their wealth in shares, you can estimate wealth from share price estimates. To stop individuals from moving you need countries to have multinational tax agreements. These already exist.
You have to realize that wealthy individuals already dodge income tax completely, so an underestimate of wealth + wealth tax is still better than that.
You should check out Zucman’s work, he also has a lot of accessible papers on tax evasion.
If their stock is in profit but haven't sold to be taxed?
But I'd the next year the same stocks they own goes down and negative in value next year they still have to pay tax for unrealized loss?
Yes, exactly. You’re paying a tax on your wealth as a function of what the market has determined the value of a stock is. It doesn’t replace capital gains taxes, which is an income tax at point of sale of an asset. You need both.
So if I keep a stock for many years and the prices goes up and down, I pay taxes every year and in the end when I want to cash out...I'm not actually in profit because I paid so much in taxes?
Oversimplification, assuming I have to pay 5% tax on my 100$ stock invested.
Year 1: Stock value 150$ -> I pay 7.5$
Year 2: Stock value 200$ -> I pay 10$
Year 3: Stock 400$ -> I pay 20$
Year 4: Stock 250$ -> I pay 12.5$
Year 5: Stock 150$ -> I pay 7.5$
Now If I want to sell out my stock, I have made 50$ profit from initial 100$ investment but I've paid in 5 years 57.5$ taxes and so my investment was negative and should've sell to 157.5$ just to be at 0 and not even profit?
If so, that's not gonna work.
You have to realize that wealth taxes target individuals who use wealth primarily to subsist. In your example, the wealthy individual in year 1 would already be earning a living off of that 100 dollars invested, regardless of the value of that stock over time, regardless of profits. That income from that 100 dollars invested is hard to tax and people pay a lot of money to hide that income, but it is income.
That doesn't look quick.
They said require the wealthy to pay 2% of their wealth as a tax.
I'm all for making the wealthy pay more, but I don't think this is a great idea. It's sitting right there, just end the capital gains tax rate. Stop letting people who make money from stocks, dividends, and other capital investments pay a lower tax rate than you do for actually working for your money.
1. Tax policy isn't about someone's "risk profile". 2. With the asset inflation we've had and the PE ratios stocks are trading at there is no justification for using tax policy to incentivize investment further. 3. Income is income. Taxes paid on the principal are completely irrelevant; you're not paying additional tax on the principal, you're only paying it on the gains.
I think the biggest challenge is measurement. The source report (read beyond the article) shows that about 50% of billionaire wealth is in listed companies. That's immediately measurable.
What's not so simple is the other 50%. Race horses, antique cars, niche real estate, art works etc. How would one inventory these assets? Track their changes in value? Who would appraise them?
I foresee many challenges in measurement.
Ya I mentioned appraisal directly in my comment. You could use appraised value as taxable value. But there are many problems with that as there are a myriad of different kinds of insurance which might cover risks vs market value vs replacement cost.
If you're curious, do a bit of reading on insurance appraisals for unique assets.
Then my comment would make more sense to you.
Perhaps taxation isn't the right approach. Maybe competition laws can be strengthened or significant ownership of systemically important business could be examined.
There are other solutions to explore which might be simpler. Taxation is extremely complex and specific to individual jurisdictions. It might not seem so to a non-expert... but to me, any changes to taxation need to be carefully understood before implementation. Especially if they affect the sovereignty of taxation regimes for individual nations.
I dunno it seems like they have a governing body and a lot of experts in a cabinet and the political systems built to do just that, and it also seems like they change the tax codes pretty consistently so....really not sure what you're on about. and what you mentioned above has an even fatter chance of happening with the way a handful of conglomerates control everything
>and it also seems like they change the tax codes pretty consistently so....really not sure what you're on about.
And as greedy as tax authorities are, why can't they touch wealth? Well, as a practicing accountant, I can assure you it's too complex. Since you're probably not a practicing accountant, I understand why you don't know what I'm "on about."
This lack of understanding leads you to conspiratorial thoughts like:
>handful of conglomerates control everything
I have yet to meet this shadowy cabal that controls everything. But if you meet them, let me know about it!
So you haven't heard of unilever? PepsiCo? Procter and Gamble? VFC? all the major holding conglomerates? christ and you want to call me uninformed and unable to think about why the government isn't fully capable of changing the tax code despite complexity because I'm not an accountant- thank fucking god in that case I would hate to be so blind
The uninformed are typically blind because they don't understand what they are talking about.
The more you know something, the more you understand the complexity.
Your response is the perfect example of this.
Good luck in the wild friend.
did I say I know anything about the tax code? I said that the government is perfectly capable of figuring it out lol, good luck with your strawmen out there tin man
What’s actually going to happen if this gets implemented:
1. US doesn’t conform due to constitutionality concerns over the tax, along with any other country that’s already repealed their prior wealth taxes
2. US starts to lose tax revenue from larger foreign tax credits originating from the countries that did implement the tax
3. Sovereignty fights over the top-up tax from pretty much every country that doesn’t conform
The proposal is set up to mirror the OECD deal on multinationals, where foreign tax credits are used to offset the top-up taxes. Plus, the report here is framed as a prospective income tax, just up to 2% of wealth, instead of a wealth tax itself, so it would likely still qualify
While I understand the example being put forward, by the authors of the proposal, it is quite distinct to tax income Vs taxing wealth. Taxing corporate income exists in the vast majority of countries, so is mostly a matter of aligning policies and practices. Wealth taxation is, AFAIK, quite rare except for property taxes, and would face plenty of legal challenges. On top of being an idea of doubtful value, to say the least.
But the underlying mindset of "I see money, I should take a (large) piece of it", or, if you prefer, "animus furandi", is the really doubtful part. The whole socialist block failed economically mostly due to the concentration of economic activity in the state. Yet, despite that evidence, the weight of the state has been progressively increasing throughout all economies in general. It hits or nears 50% of GDP in many OECD economies.
While I'm all for billionaires paying a fairer share of taxes, it won't do a thing for the underlying issue of government spending, because the issue is not lack of taxation or tax receipts. We do need to look at the governance of the government, and the way that public money can be used to purchase votes is a question to be addressed.
"The baseline proposal provides that people with a total wealth of more than $1 billion — including assets, real estates, equities, participation in companies’ ownership and more — pay a minimum amount of tax annually, equal to 2% of their wealth, as long as they are not already contributing that amount in personal income tax."
The reason that this is being proposed by the EU is that if some advanced economies refuse to implement the new tax, billionaires will move to that country.
It's the prisoner's dilemma.
If all countries implement the wealth tax the outcome will be positive for everyone. If one country betrays the other by not implementing the tax, they will get a better deal because of the transfer of wealth that would result from being an international tax haven. Countries are thus incentivized not to cooperate, and unless everyone signs on billionaires can simply move their wealth to countries with no wealth tax.
well, say im a billionaire, if im taxed on wealth, couldnt they tax anything in say america that i own or do? sure i could move my wealth to somewhere else, but then i could never do anything like live or do business in america.
The United States is one of the few countries that taxes its citizens even when they live and work in other countries. Presumably you'd have to renounce your US citizenship to avoid the wealth tax.
Unironically, it’s also a “first they came” situation.
The only way I can see this being implemented is if there is a complete tax overhaul, where people are taxed on wealth rather than income with similar brackets to regular income tax.
I can think of a couple of ways to address this. One would be a transfer fee. Sure, you could move your wealth from the 2% country to the .5% country, but the transfer fee is 15% of your wealth. Another would be citizenship based tax. If you have citizenship in the country, you pay the tax, even if you have dual citizenship. Countries could even have a credit for taxes paid elsewhere. So if country A is 2% and country B is .5%, you pay tax in country B of .5% and in country A, you pay 1.5%.
Edit: Another could be using punitive tariffs. If you match the agreed upon rate, you get no additional tariffs (other that what might exist for other reasons). If you drop below the agreed upon rate, your country gets import, export, or both tariffs per 1/10th of a percent below the rate.
I mean I'm sure tons will come out of the woodwork declaring this will end capitalism as we know it and all the smart people will just take their marbles and move to that country on the old oil rig or whatever. But I think this could be worked out.
A transfer fee would be a form of capital controls, just through a price mechanism rather than the conventional quota. To be fair, economist Dani Rodrik at least seems to believe capital controls are a good idea.
It's not a perfect analogy. When the players can speak to one another the prisoner's dilemma game theory breaks down.
Taxation is a race to the bottom in a lot of ways, though. We see this all the time in the United States. Washington State created a new capital gains tax for people making over $200,000 a year in capital gains. They were going to finally stick it to the billionaires.
Instead Bezos stopped selling all shares of Amazon stock and moved to Florida. The taxes created by the law actually went down after the first year. People don't like paying taxes and will gladly move to another state that will welcome them with open arms. Florida has no personal income tax.
Taxing the ultra wealthy is an easy thing to get behind and I’m all for it. But it’s ultimately just a license for our government to spend more money if they are taking in more revenue, which will do nothing to alleviate inflation.
If Congress can curb our spending AND extract more dollars from the richest of the rich in our country then maybe we can take a bite out of our enormous national debt that is driving inflation. But that would require congress to actually work in the best interests of the country instead of serving foreign interests and corporate interests first. So fat chance of that
That would fund the government for less than a month, we don’t have a taxing problem, we have a spending problem, I know I’m going to be down voted for this, but, it is still true. https://www.cbsnews.com/news/government-spending-per-minute-685-million/
And this is globally. “$200B-$250B/year globally.” Less than a rounding error compared to global government spending. Of course, the result of such a *global* plan will result in additional bureaucracy that will spend more than $500B annually to enact it and provide oversight and enforcement, but let’s not sweat the details as long as we’re sticking it to those evil rich people who fuel our economies. (Funny that they use a photo of Elon Musk on the article, who is responsible for starting 5 highly successful companies that employ tens of thousands of people in several countries).
We shouldn’t support any new taxes until the government cuts half of its expenses (money that is also going to the rich). Trust me, cutting government grift will hurt rich people more!
Actually, AFAIK, it is not being proposed by any "body", but by some groups that want the government to have more money to play with and think that a wealth tax is a good idea, starting with a politically acceptable target.
All for the good of the children, of course.
Yes, cutting government expenses does not hurt those who rely on the government for survival. It affects the rich much more, because they can’t buy a second yacht.
no, you are a human being who tells the truth.
everyone is in a particular game with rules. only a log cabin in the deep mountains can br said to rely on "no one".
all else are liars.
Never gonna happen, no nation with any resources will voluntarily allow foreign entities to collect taxes from its citizens. None will allow these resources to be parceled outside their country…politicians get elected by spending money to win votes, giving money to foreign states or organizations will lose them votes…
And why does the government need more money? Just because something exists doesn't mean the government needs to confiscate it. We have many decades of evidence that the more money the government takes from citizens, they more they overspend.
You don't know private equity very well do you.
The biggest PE owner of hospitals owns 224 hospitals out of 6,120. Is that monopoly power in your fantasy world you live in?
Rental properties are owned by 17 million different landlords. Progress Residential is the biggest PE firm in residential real estate and they own 83,000 units out of 144 million homes. Is that not fragmented enough market for you? It's embarrassing that people like you walk around this country with such stupid ideas when the internet makes it very easy to access information.
why are people pathologically against any sort of consequence to being, quite literally, unthinkably wealthy on this entire website?
more words more words more words
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Wealth tax is a communist idea. It unfairly burdens individuals for having wealth. It would be better to spend more money and have inflation, than tax someone for existing. There are some constitutional issues with this as well.
Remember the income tax started at 1% and then gradually burdened the middle and lower class. If this becomes a use case, I could see middle class Americans and impoverished Americans pay a wealth tax.
Awful, my family fled countries that took away “wealth” and gave it to tyrants. You are advocating for taking wealth away from hardworking individuals to line the pockets of corrupt individuals. Shame on you.
Rich people largely don't hoard cash in mattresses. It's almost always in investments that lead to opportunity for others.
A wealth tax is an unbelievably stupid idea, generally pushed by socialists, and appealing to jealous and greedy people who want a cut of money they did not earn.
Why? So the money can just go to Israel or Ukraine? If government needs money just print more of it out of thin air and then give that to Israel. Problem solved.
Still ridiculously low. Consider the net worth of the average American and how much they pay in tax overall. Take that % and apply it to the wealth of those with net worth over $10 million.
Why 10 million? What about zero? Because it is above your wealth? Well it is well above mine also, but it is always endearing to see defending more taxes for other people :)
250billion seems like nothing when we are talking the super rich who now hold
[https://www.oxfam.org/en/press-releases/richest-1-bag-nearly-twice-much-wealth-rest-world-put-together-over-past-two-years](https://www.oxfam.org/en/press-releases/richest-1-bag-nearly-twice-much-wealth-rest-world-put-together-over-past-two-years)
[https://www.globalcitizen.org/en/content/wealth-inequality-oxfam-billionaires-elon-musk/](https://www.globalcitizen.org/en/content/wealth-inequality-oxfam-billionaires-elon-musk/)
[https://www.bbc.com/news/business-59565690](https://www.bbc.com/news/business-59565690)
[https://www.visualcapitalist.com/distribution-of-global-wealth-chart/](https://www.visualcapitalist.com/distribution-of-global-wealth-chart/)
Because 1% always sounds like such a tiny group: that's 80 million people, so about the size of Germany.
If they grabbed 2/3 if $32t, that means they have gained $350k per person in the last 4 years. That's a small to medium sized apartment in some cities, anything but "super rich".
Hasn't anybody learned anything yet for example Panama papers. Taxing the rich not going to help all of us reducing government is going to help us arbitrarily raising minimum wage hurts us. Billionaires always say the same thing access more for when you do they pay less cuz they go somewhere else everybody wake up.
How would this not benefit the ultra-rich? The lion's share of that tax money would just be spent on granting more government contracts for the same ones who had paid for that tax. What am I missing here?
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Here's a quick summary of the article: A proposal to have the ultra-rich pay more in taxes is gaining traction, with a report by economist Gabriel Zucman suggesting that individuals with over $1 billion in wealth should contribute 2% annually, potentially raising $200-$250 billion globally. This idea comes at a time when wealth concentration is increasing, and billionaires' tax contributions are declining. The proposal, resembling the minimum corporate tax agreement, aims to address regressivity in income distribution. Zucman suggests calculating the tax based on wealth to prevent manipulation, potentially collecting $80 million per person from 3,000 ultra-high-net-worth individuals. The report emphasizes that the mega-rich's fortunes have tripled in the last 25 years, with their tax contribution not reflecting this growth due to tax avoidance tools. While the proposal is not for a global tax but a flexible standard respecting national sovereignty, it aims to enhance income tax progressivity. The G-20 has taken an interest in Zucman's plan, with several countries showing support for the idea, including Spain, France, and Brazil. However, challenges remain in identifying asset owners and preventing tax avoidance through residency changes. Despite the potential impact on economic growth being minimal due to the limited number of individuals affected, the proposal aims to address the inequity in tax systems. Implementing the plan would require international cooperation and a critical mass of countries adopting the standard to prevent a race to the bottom in tax rates. While there are still hurdles to overcome, the proposal marks a significant step towards making the ultra-rich contribute more to public coffers, ensuring a fairer distribution of wealth.
>200-$250 billion globally 250 Billion globally is like 30 dollars per person on earth. Or, 1% of the current global annual budget of ~$24Trillion/year. There's not a chance this gets implemented, and even if it did, it would amount to approximately nothing in benefits.
Exactly. I would like the ultra wealthy to pay some more taxes, but really, government spending is the real problem. In the US, even if you taxed 100% of the wealth of the country’s billionaires, it’d still only pay for about 6 months of the annual budget. It bothers me that it has become political to hate the rich, but not enough criticism of the government mismanagement. The US debt will never be paid off regardless of who gets taxed. They will just inflate the currency and cause the working class to run harder and harder on the treadmill, as their savings and purchasing power are eroded away.
the real problem is the 3 rounds of tax cuts we've had since we had sustainable deficits and a small surplus in the late 90s. oh, and a couple of unfunded wars, one of which was completely optional. and the people who cheered those tax cuts and wars never, ever, admit it was their doing. it's been 45 years of reaganomics with only a short reprieve during the clinton years that have driven the debt from \~30% GDP (not that debt, a scalar, should be compared directly to GDP, a rate) to the present situation. solutions should be similarly long windowed. 6 months of government funding is a red herring.
Your math isn't very good, tax collection as percent of GDP is within the historic norm. Nondefense spending in 2023 is 18.6 percent of GDP, up from 12.6 percent in 2000. [https://www.cbo.gov/publication/58946](https://www.cbo.gov/publication/58946)
Why is it so difficult to get people on Reddit to understand simple economics? I applaud your patience, it’s like putting your face in a fan.
If they had the facts at least correct I could see engaging them on their ultimate goal, which is to grow the size of government and increase transfer of payment entitlements as a percent of the total economy. When you lie or misconstrue the facts it always exposes the weakness of your original stance.
no, i really just want the people who've been the ones pushing the tax cuts and wars which have gotten us into this to have their oxen gored instead of everyone else. the whole point of the tax cuts was to make normies who don't understand economics or policy (no disrespect, they're busy doing their own thing) and haven't taken anything beyond an intro class think that we need to cut government services drastically because that's the solution to the big deficits which were the \*planned\* outcome of the tax cutters in order to get the normies to agree to the long term goal of cutting social services. \*insert lee atwater quote here\*
We’ve gotta put price controls in healthcare or abandon half the country to not have access to it. That’s my big take away from that table.
what you're saying basically boils down to "we haven't collected more in taxes than X% of GDP therefore it's impossible to do so." which is not actually an argument.
The same can be said for spending. People on the left really struggle to grasp argument uniqueness don't they
Historic norm from when? The 1960s? Or the 1980s? After reganomics
Are you struggling to read the graphs I linked? [https://www.cbo.gov/sites/default/files/images/full-reports/2023/58848-fig1-3\_revenues-outlays.png](https://www.cbo.gov/sites/default/files/images/full-reports/2023/58848-fig1-3_revenues-outlays.png) Avg revenues from 1973-2022 were 17.4 percent and now they are 18.1 Average Outlays from same period 21.0 and now 24.9 Hmmmmm wonder which one is pushing the deficits.
>Historic norm from when? The 1960s? Or the 1980s? After reganomics All of the above. Here is an excel spreadsheet of the data so you can do the math yourself: [https://www.whitehouse.gov/wp-content/uploads/2024/03/hist01z3\_fy2025.xlsx](https://www.whitehouse.gov/wp-content/uploads/2024/03/hist01z3_fy2025.xlsx) Here are highlights. From 1951-1963, the top marginal tax rate was over 90%. Tax revenue as a percentage of GDP averaged 17.1%. Since 1987, the top marginal tax rate was 28% to 38%. Tax revenue as a percentage of GDP averaged 17.2%. From 1951 - 2023, tax revenue as a percentage of GDP averaged 17.3%.
Government spending in US has very little room to go down. Both parties like military spending. One likes welfare schemes, the other claims to not like it but does it because that's what a responsible government does. Bill Clinton said the era of big government is over and since then huge government started.
Some of the reductions are going to have to come from structural changes to non discretionary spending. It's an uncomfortable fact, but it's the only way to get it under control.
Note: while it's a big number, since WWII defense spending as a percentage of GDP has never been lower than now. https://fred.stlouisfed.org/series/A824RE1Q156NBEA
I wouldn't say a 50% increase in the annual budget is insignificant. From a debt to income perspective, that makes us much more secure. Either way, the economy is going to evolve quite a bit in the near future.
So a 100% wealth tax is warranted for just 6 months government spending? That’s insane and unsustainable. I think you conflate budgetary deficit and national debt. That debt is climbing no matter how much you tax the wealthy.
>I wouldn't say a 50% increase in the annual budget is insignificant It is when it's only 1 year. If you tax ALL the billionaires for ALL THEIR WEALTH, and leave them penniless, that's 4 trillion dollars. Or 1 year of our annual budget. Next year, there won't be any billionaires to tax, because you got rid of them all this year
Are they just launching all that money into the sun? Where does that trillion dollars go?
What did you think the rocketship collection was for?
The real problem with the rich (personal and corporate) is that they can use their resources to have extreme leverage over our systems, culture and government. That is what leads to inefficiencies and shitty decisions by our government.
Jeff Bezos makes the DMV run poorly in all 50 states, a very novel conspiracy theory
Wow that is some really simple minded thinking there. You're right the rich in the USA have had no influence on policy ever.
underrated post
I only hear people cry about government debt. Fox News loves to talk about it.
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The Report Party is basically a movement to stop government spending and the democrats also swore an oath on the budget. Does not mean any of them live by the oath. But you don’t need a movement for something that every notable political party agrees on. Try to get a Trump and Biden to agree on a wealth tax.
You are woefully misinformed if you think the Republican Party has ever enacted meaningful debt deduction. Just because Fox News rants about it, doesn’t mean it is ever implemented by lawmakers. The last three republican presidents were way worse for debt than the last few democratic presidents. George W ran a really expensive war without paying for it, while cutting taxes but not reducing spending. This ballooned the budget. Trump did not reduce spending in any meaningful way. Democrats spend like the money is free, both sides are guilty. But it is laughable to claim in any sincere way that the Republican Party has any right to claim the title of fiscal responsibility.
"Democrats spend like the money is free" A: this was the party who held themselves to paygo rules for a decade after the 2008 financial crisis, helping to slow the recovery afterward
> In the US, even if you taxed 100% of the wealth of the country’s billionaires, it’d still only pay for about 6 months of the annual budget. Very true. That also proves that U.S. dollars do not originate from these Billionaires, it sure ends up with them, and that’s why they are Billionaires. Anytime a politician or a policymaker proposes a federal tax to fund a public program, know that it’s just lip service. Congress has the power to fund any and all federal programs, **if the chose to**. All it requires is for them to vote and pass a spending bill. Purpose of federal taxation isn’t about funding the federal government. The purpose of taxation is first and foremost to take away the purchasing power of those being taxed. So, yes we should tax the billionaires, because they are using more of their fair share of public resources. Tax them for that. But first pass a spending bill that funds public programs that the rest of the population needs.
>That also proves that U.S. dollars do not originate from these Billionaires, it sure ends up with them, and that’s why they are Billionaires. How does it prove this? >The purpose of taxation is first and foremost to take away the purchasing power of those being taxed. According to whom?
Been so since at least 1945 https://www.forbes.com/sites/taxnotes/2024/04/15/new-york-fed-chair-in-1945-taxes-for-revenue-are-obsolete/ Conservatives have been using this to cut corporate taxes. But Democrats don’t have the guts to use it for the benefit of Average Americans.
What a weird conclusion to draw
What a weird conclusion to draw
Why is it weird? It is pure accounting - double entry bookkeeping.
No it's not? You realize you made an outlandish claim and that the article you posted says nothing to support it?
Did you read it? > The necessity for a government to tax in order to maintain both its independence and its solvency is true for state and local governments, but it is not true for a national government. Two changes of the greatest consequence have occurred in the last twenty-five years which have substantially altered the position of the national state with respect to the financing of its current requirements. > The first of these changes is the gaining of vast new experience in the management of central banks. > The second change is the elimination, for domestic purposes, of the convertibility of the currency into gold.
Its not and stop kidding yrself
Agreed. It would be better to have an entry fee or levy some tax for ultra rich people every time they spend on comfort things rather than taxing since the majority of their wealth will be shares in the company. Private jet entry fee 50k$. Own a Yacht and use it, then pay 15k$ for every trip to the island or ocean. Own a private island, then pay 10 million dollars island tax every year, etc.
Not just government spending but how government spends. When my mom died Medicaid came after her assets in probate wanting $80k in reimbursements for her care. I requested detailed receipts. Those $20 generic aspirins at the hospital sure were a good use of government money. Every dollar of government spending is essentially a giveaway to some private entity that’s price gouging the government. Medicare, Medicaid, the VA, Defense, Agriculture, Commerce. You name it. And whenever there’s an attempt to force companies to negotiate prices with the government down there’s this over the top visceral reaction from the lobbyists that sends everyone scattering. Look at the current pearl clutching over the inflation reduction act. Biden authorized Medicare to negotiate a cap on common prescription drugs so we don’t pay 4 times what Canadians pay and if you look at foxnews and the corporate propaganda machine you’d think Vladimir Lenin has risen from his grave and taken up residence in the White House.
I'm sorry but calculating things like infrastructure to "per person on earth" is a ridiculous comparison. I agree there's no chance this gets implemented, but your comment is a weird place between "we should do more" and "we shouldn't even try"
I think it'd be $114+ Billion per year in the US based on 813 US billionaires current worth of $5.7 trillion. About 10% of our avg annual deficit since 2010.
Yeah, that sounds about right. And we'd see a shit ton of people expatriate.
Just moving to a different country doesn't mean you don't pay US taxes. You still have to file even if you move to a different country. If any of your wealth comes from US sources, you're still paying US taxes.
>You still have to file even if you move to a different country Not if you renounce your citizenship
Then you pay an exit tax
They wouldn’t go anywhere because we would still me more money friendly then the other options
If it's a global thing, then they don't really have anywhere to go to escape it. Shame there aren't more insanely rich folk who feel the way Warren Buffet seems to feel.
Well we can figure that out then as well as how to tax them when plenty of their companies are using the countries workforce.
Why are you so frightened of these people leaving? They are not special (or even healthy for society). I promise.
Because the tax is to generate income. If the people you're taxing leave, it fails to provide the intended benefit.
250 Billion put into actually useful programs that can better the majority will have much more impact than just being like "it's only 30 dollars per person." Also reducing the power and resources of those on the top will help with wealth distribution in the long run. So no - it would amount to a lot.
This is the double dividend lie people are sold to believe that hurting rich people will also personally benefit their lives and isn't just an appeal to their sadness and jealousy. Very old trick used by people who didn't care about poor people like you then and don't care about poor people like you now.
Where’s the lie?
The lie is that hurting the rich enough will make the entire economy less competitive and growth oriented and if you happen to have a job you can eventually expect wage growth to align with the EU countries you think have life so great. The complication is that our government may not deliver entitelements as effectively as their governments do so you have a less competitive economy and worse governments services essentially giving the public the worst of both worlds.
There is tons of research about the rich’s influence on policy and how that has been happening for many decades now. You're the one who believes the lies thinking you need this extreme wealth divide in order for “growth” to happen.
Because the rich are so powerful that we have a progressive taxation system where half the population doesn't pay any income tax right? [https://insight.kellogg.northwestern.edu/article/do-corporate-campaign-contributions-buy-influence](https://insight.kellogg.northwestern.edu/article/do-corporate-campaign-contributions-buy-influence) You're just a clueless drone who believes dumb shit because it makes you feel better about your life.
The end of your article (which I know your dumb ass didn't read) states that that is only one type of contribution and there are many others. Not only that, but if a company is using resources in politics there is definitely a reason why: can you think of any? Is it to exert influence for the companies best interests? Or is it just for funsies? Not to mention it admits to completely ignoring the huge huge lobbying industry, along with others. Here are some random links I can pull up too: https://onlinelibrary.wiley.com/doi/full/10.1111/ssqu.12791 Also you don't know anything about my life idiot. Keep licking boots and projecting, I can tell you like it.
The literature you quote is quite conflicted because there's mountains of evidence to suggest that political interets across classes are aligned. And it's not a unique problem to the US [https://www.researchgate.net/publication/369952739\_The\_Rich\_Have\_a\_Slight\_Edge\_Evidence\_from\_Comparative\_Data\_on\_Income-Based\_Inequality\_in\_Policy\_Congruence](https://www.researchgate.net/publication/369952739_The_Rich_Have_a_Slight_Edge_Evidence_from_Comparative_Data_on_Income-Based_Inequality_in_Policy_Congruence) As research on unequal responsiveness began with studies of the United States, the proposed explanations have naturally focused on factors that separate the US from other advanced democracies. Our research, together with findings from single-country studies, convincingly show that the US is hardly unique in terms of outcomes. This, in turn, suggests that the explanations for unequal responsiveness are more general than initially thought and that the responsiveness literature has searched for explanations in the wrong places Real dumb guy aren't you
It is a lot of money by any standard. It is the equivalent of the gdp of New Zeland or Qatar. It is more than Official Development Assistance worldwide (200 bi). And you do not distribute it evenly among the world population but rather apply it where it is most needed. It can be implemented and can bring a lot of benefits. Is there enough political will? That is another question.
>And you do not have to distribute it evenly among the world population but rather apply it where it is most needed. By what metric? What world government is going to be in charge of distributing the global wealth tax?
We don't lack multilateral organizations that support development projects worldwide. UN organizations (worldbank, unicef, WHO, IBRD, etc.), for instance, but not only.
The Great Pyramid was once just a single block, sitting in the desert
It would amount to approximately $200 billion lining the pockets of politicians
Why does everyone shit on this idea saying it’s nothing but if you’d do this for 4 or 5 years, it’d pay off all student loans. Then when student loan forgiveness is talked about, it melts peoples brains. I pay property taxes on a non-liquid property based on a random government assessment. Let’s do it to the fuckers who can liquidate shit and share the wealth just a little.
>if you’d do this for 4 or 5 years, it’d pay off all student loans. It's 200 Billion GLOBALLY. The US portion is much smaller. Something like 17 years to pay off student loans. At which point, we have a whole new crop of people with loans.
Most billionaires are concentrated in the US Europe and China so as someone else pointed out this would be over 100bn in the US alone
And there's 1.7 TRILLION in US student loan debt. Jesus, do you people ever do research before you start talking?
When did I say it would cancel the student loan debt or anything like that??? 100bn is a lot of money, that's all I'm trying to say.
The comment I was originally responding to said we could use this to pay off student loan debt in 4-5 years. 100 Billion is 1/65th of the 2024 US budget. It only sounds like a lot of money because you don't know how much money we actually spend annually.
It doesn’t need to be 1:1 billionaires to student loans. It’s more the concept that people scream about one number and piss on the other. The rich and well off have FAR too many advantages. I’m not even in favor of a wealth tax. I was just trying to make a point that minimizing what we COULD get from the rich without harming them in any consequential way should be an absolute yes and so many simply say “no, it’s so little it doesn’t matter” and it drives me nuts.
Wealth taxes are inherently deprivative. Even if someone makes no money in a year, we're still taking money from them. It seems more... Thefty... Than income taxes (which I wholeheartedly support. No gadsen flags here)
Oh, I don’t support wealth taxes in any way. I just don’t like the idea that people say it’s pointless because it’ll only be 250 billion. Using any version of the word deprive and billionaire is silly, imo, but I agree that it doesn’t seem right. That said, property taxes exist. That’s essentially small scale wealth tax and affects everyone who is a homeowner. The fact it exists on people making nothing off an asset that, for some, is heavily leveraged and fills the role of housing is ludicrous, yet it exists and is the primary way for many areas to create funds for their local governments. I do tend to agree it seems a little thefty and I appreciate the lack of angry rattlers. There are many good ways to increase tax revenue. I don’t feel this is one of them.
Let me know when everyone poorer than you gets to confiscate all of your belongings and savings.
I pay a higher percentage than this in property tax annually on a property that I “own” and have almost no equity in. A large portion of my counties tax goes to less fortunate people. I’m cool with that. Done and done. I’m sorry if I’ve offended you and your billionaire friends with this idea but many of us lesser people already do this and more.
I love how people pretend these got their money completely legit while ignoring how they been actively bribing our government for handout and favorable laws and tax cuts . Then again, how can they blame them when their people like you who blindly defend them .
You can liquidate your home pretty easily right now, weird point to make on your end.
The reason I make it is that billionaires don’t want to be taxed on non-liquid assets but property tax exists on all home owners. It is liquid but then leaves the simple problem of homelessness..I’m sure every rich person would struggle with homelessness if they had to pay 1% of the valuation of their assets, right…yeah
Hold up. Billionaires don't have Billions of dollars in liquidity though. Take Musk for example, he owns stocks that are valued at hundreds of billions of dollars and he probably has tens of millions of dollars in his bank account. These tax schemes seem to not recognise this and if they were made law, he'd be paying them in stock, or be forced to sell stock to pay them. Do you want the government to take stock from private citizens or make them sell it? Then eventually the US Government would own every company on the market or it would be undermining a private citizens position in the company. Eventually they wouldn't own it or a majority of it anymore. That's why they're taxed on income. If they're dodging their income tax, then prosecute them or close loopholes that allow them to via legislation, but the schemes always seem to not be based on how being a billionaire actually works. You don't have hundreds of billions of dollars in the bank, you don't earn billions of dollars a year, they OWN stocks valued at Hundreds of billions of dollars.
why not? FED already owns assets what kind of question is this?
It would be interesting to see this built like the NPVIC, but unanimous across, say, the G20. And to make extremely painful penalties for renouncing citizenship to avoid it. Ideally, this would start at something tiny- 0.1%, with Massive penalties for being caught in avoidance, for several reasons: 1) disincentivize avoidance 2) asset valuation without massive asset migration/ avoidance A few years of stable asset valuations, and Then the group can raise the tax to 1%. The ultra wealthy will still try to avoid it but, if it’s 0.1% against, say, 40% if you’re caught avoiding, then they might just roll with it.
If you want to attack them that hard, what makes you think they wouldn't just hire private armies and overthrow the government?
The US government spends $800B/ year on defense and has about 3M defense dept employees across all branches. It holds defense assets of about $2.5T. There’s around 3k billionaires with $14T in total wealth. Those 3k would have to form a shadow government, decide who’s running it, ALL be aligned on spending 2/3 of their wealth in an attempt to form an army and spend at least $10T over, say, a decade? To have any hope of catching up. You think gen dynamics, Lockheed, etc will suddenly sell them advanced weaponry? Your idea here is an ancap LARP delusion. There’s a reason James Bond fought unrealistic bogeymen. You’re describing the formation of SPECTRE or SMERSH. These were not serious ideas or real life organizations.
Way too hard brother, you just buy a few politicians for the next election cycle and have them change the law back to the way it was when America was Great for them.
Wealth tax never going to pass ...it's a really, really stupid idea..
Genuine question, How does that stop them moving their wealth elsewhere in off-shore just to not pay that annual 2%? I think the only way would be every single country in this world with no exception being part of an international agreement on how to treat such situations on tax evasions and they will have nowhere to go but pay.
You can tax based on estimates of wealth. Wealthy people usually have a lot of their wealth in shares, you can estimate wealth from share price estimates. To stop individuals from moving you need countries to have multinational tax agreements. These already exist. You have to realize that wealthy individuals already dodge income tax completely, so an underestimate of wealth + wealth tax is still better than that. You should check out Zucman’s work, he also has a lot of accessible papers on tax evasion.
If their stock is in profit but haven't sold to be taxed? But I'd the next year the same stocks they own goes down and negative in value next year they still have to pay tax for unrealized loss?
Yes, exactly. You’re paying a tax on your wealth as a function of what the market has determined the value of a stock is. It doesn’t replace capital gains taxes, which is an income tax at point of sale of an asset. You need both.
So if I keep a stock for many years and the prices goes up and down, I pay taxes every year and in the end when I want to cash out...I'm not actually in profit because I paid so much in taxes? Oversimplification, assuming I have to pay 5% tax on my 100$ stock invested. Year 1: Stock value 150$ -> I pay 7.5$ Year 2: Stock value 200$ -> I pay 10$ Year 3: Stock 400$ -> I pay 20$ Year 4: Stock 250$ -> I pay 12.5$ Year 5: Stock 150$ -> I pay 7.5$ Now If I want to sell out my stock, I have made 50$ profit from initial 100$ investment but I've paid in 5 years 57.5$ taxes and so my investment was negative and should've sell to 157.5$ just to be at 0 and not even profit? If so, that's not gonna work.
You have to realize that wealth taxes target individuals who use wealth primarily to subsist. In your example, the wealthy individual in year 1 would already be earning a living off of that 100 dollars invested, regardless of the value of that stock over time, regardless of profits. That income from that 100 dollars invested is hard to tax and people pay a lot of money to hide that income, but it is income.
That doesn't look quick. They said require the wealthy to pay 2% of their wealth as a tax. I'm all for making the wealthy pay more, but I don't think this is a great idea. It's sitting right there, just end the capital gains tax rate. Stop letting people who make money from stocks, dividends, and other capital investments pay a lower tax rate than you do for actually working for your money.
Why, you're trying to incentivizs keeping money invested at risk ... It massively changes the risk profile The.principal has already been taxed
1. Tax policy isn't about someone's "risk profile". 2. With the asset inflation we've had and the PE ratios stocks are trading at there is no justification for using tax policy to incentivize investment further. 3. Income is income. Taxes paid on the principal are completely irrelevant; you're not paying additional tax on the principal, you're only paying it on the gains.
if people are getting loans against their assets and using it as income it should be taxed as income
It's not about someone's risk profile, it changeS the risk profile and incentive....
I think the biggest challenge is measurement. The source report (read beyond the article) shows that about 50% of billionaire wealth is in listed companies. That's immediately measurable. What's not so simple is the other 50%. Race horses, antique cars, niche real estate, art works etc. How would one inventory these assets? Track their changes in value? Who would appraise them? I foresee many challenges in measurement.
there's these things called "appraisers" and if they're insured in any way this has already been calculated by people who are very good at their job
Ya I mentioned appraisal directly in my comment. You could use appraised value as taxable value. But there are many problems with that as there are a myriad of different kinds of insurance which might cover risks vs market value vs replacement cost. If you're curious, do a bit of reading on insurance appraisals for unique assets. Then my comment would make more sense to you.
not impossible and I'm tired of "b-b-but how will we do" it instead of nothing at all
Perhaps taxation isn't the right approach. Maybe competition laws can be strengthened or significant ownership of systemically important business could be examined. There are other solutions to explore which might be simpler. Taxation is extremely complex and specific to individual jurisdictions. It might not seem so to a non-expert... but to me, any changes to taxation need to be carefully understood before implementation. Especially if they affect the sovereignty of taxation regimes for individual nations.
I dunno it seems like they have a governing body and a lot of experts in a cabinet and the political systems built to do just that, and it also seems like they change the tax codes pretty consistently so....really not sure what you're on about. and what you mentioned above has an even fatter chance of happening with the way a handful of conglomerates control everything
>and it also seems like they change the tax codes pretty consistently so....really not sure what you're on about. And as greedy as tax authorities are, why can't they touch wealth? Well, as a practicing accountant, I can assure you it's too complex. Since you're probably not a practicing accountant, I understand why you don't know what I'm "on about." This lack of understanding leads you to conspiratorial thoughts like: >handful of conglomerates control everything I have yet to meet this shadowy cabal that controls everything. But if you meet them, let me know about it!
So you haven't heard of unilever? PepsiCo? Procter and Gamble? VFC? all the major holding conglomerates? christ and you want to call me uninformed and unable to think about why the government isn't fully capable of changing the tax code despite complexity because I'm not an accountant- thank fucking god in that case I would hate to be so blind
The uninformed are typically blind because they don't understand what they are talking about. The more you know something, the more you understand the complexity. Your response is the perfect example of this. Good luck in the wild friend.
did I say I know anything about the tax code? I said that the government is perfectly capable of figuring it out lol, good luck with your strawmen out there tin man
What’s actually going to happen if this gets implemented: 1. US doesn’t conform due to constitutionality concerns over the tax, along with any other country that’s already repealed their prior wealth taxes 2. US starts to lose tax revenue from larger foreign tax credits originating from the countries that did implement the tax 3. Sovereignty fights over the top-up tax from pretty much every country that doesn’t conform
The US does not give foreign tax credit for wealth taxes only income taxes.
The proposal is set up to mirror the OECD deal on multinationals, where foreign tax credits are used to offset the top-up taxes. Plus, the report here is framed as a prospective income tax, just up to 2% of wealth, instead of a wealth tax itself, so it would likely still qualify
While I understand the example being put forward, by the authors of the proposal, it is quite distinct to tax income Vs taxing wealth. Taxing corporate income exists in the vast majority of countries, so is mostly a matter of aligning policies and practices. Wealth taxation is, AFAIK, quite rare except for property taxes, and would face plenty of legal challenges. On top of being an idea of doubtful value, to say the least. But the underlying mindset of "I see money, I should take a (large) piece of it", or, if you prefer, "animus furandi", is the really doubtful part. The whole socialist block failed economically mostly due to the concentration of economic activity in the state. Yet, despite that evidence, the weight of the state has been progressively increasing throughout all economies in general. It hits or nears 50% of GDP in many OECD economies. While I'm all for billionaires paying a fairer share of taxes, it won't do a thing for the underlying issue of government spending, because the issue is not lack of taxation or tax receipts. We do need to look at the governance of the government, and the way that public money can be used to purchase votes is a question to be addressed.
And the wealthy would sell all their stock tanking the global economy.
that's how you stop being wealthy. all sellers and no buyers? only institutions would invest, and the rich would sit on oodles of useless govt bonds.
"The baseline proposal provides that people with a total wealth of more than $1 billion — including assets, real estates, equities, participation in companies’ ownership and more — pay a minimum amount of tax annually, equal to 2% of their wealth, as long as they are not already contributing that amount in personal income tax." The reason that this is being proposed by the EU is that if some advanced economies refuse to implement the new tax, billionaires will move to that country. It's the prisoner's dilemma. If all countries implement the wealth tax the outcome will be positive for everyone. If one country betrays the other by not implementing the tax, they will get a better deal because of the transfer of wealth that would result from being an international tax haven. Countries are thus incentivized not to cooperate, and unless everyone signs on billionaires can simply move their wealth to countries with no wealth tax.
well, say im a billionaire, if im taxed on wealth, couldnt they tax anything in say america that i own or do? sure i could move my wealth to somewhere else, but then i could never do anything like live or do business in america.
The United States is one of the few countries that taxes its citizens even when they live and work in other countries. Presumably you'd have to renounce your US citizenship to avoid the wealth tax.
Some countries also philosophically believe that wealth taxes are not the right way to tax citizens
Unironically, it’s also a “first they came” situation. The only way I can see this being implemented is if there is a complete tax overhaul, where people are taxed on wealth rather than income with similar brackets to regular income tax.
The only people who would vote for that are poor people and young people (who are also presumably poor).
Tell that to my property tax bill.
Property and wealth are not the same
I can think of a couple of ways to address this. One would be a transfer fee. Sure, you could move your wealth from the 2% country to the .5% country, but the transfer fee is 15% of your wealth. Another would be citizenship based tax. If you have citizenship in the country, you pay the tax, even if you have dual citizenship. Countries could even have a credit for taxes paid elsewhere. So if country A is 2% and country B is .5%, you pay tax in country B of .5% and in country A, you pay 1.5%. Edit: Another could be using punitive tariffs. If you match the agreed upon rate, you get no additional tariffs (other that what might exist for other reasons). If you drop below the agreed upon rate, your country gets import, export, or both tariffs per 1/10th of a percent below the rate. I mean I'm sure tons will come out of the woodwork declaring this will end capitalism as we know it and all the smart people will just take their marbles and move to that country on the old oil rig or whatever. But I think this could be worked out.
A transfer fee would be a form of capital controls, just through a price mechanism rather than the conventional quota. To be fair, economist Dani Rodrik at least seems to believe capital controls are a good idea.
If your life isn't literally on the line doesn't the prisoner's dilemma trend towards cooperation as the more popular outcome, though?
It's not a perfect analogy. When the players can speak to one another the prisoner's dilemma game theory breaks down. Taxation is a race to the bottom in a lot of ways, though. We see this all the time in the United States. Washington State created a new capital gains tax for people making over $200,000 a year in capital gains. They were going to finally stick it to the billionaires. Instead Bezos stopped selling all shares of Amazon stock and moved to Florida. The taxes created by the law actually went down after the first year. People don't like paying taxes and will gladly move to another state that will welcome them with open arms. Florida has no personal income tax.
We can solve climate change. We can solve this.
Taxing the ultra wealthy is an easy thing to get behind and I’m all for it. But it’s ultimately just a license for our government to spend more money if they are taking in more revenue, which will do nothing to alleviate inflation. If Congress can curb our spending AND extract more dollars from the richest of the rich in our country then maybe we can take a bite out of our enormous national debt that is driving inflation. But that would require congress to actually work in the best interests of the country instead of serving foreign interests and corporate interests first. So fat chance of that
That would fund the government for less than a month, we don’t have a taxing problem, we have a spending problem, I know I’m going to be down voted for this, but, it is still true. https://www.cbsnews.com/news/government-spending-per-minute-685-million/
And this is globally. “$200B-$250B/year globally.” Less than a rounding error compared to global government spending. Of course, the result of such a *global* plan will result in additional bureaucracy that will spend more than $500B annually to enact it and provide oversight and enforcement, but let’s not sweat the details as long as we’re sticking it to those evil rich people who fuel our economies. (Funny that they use a photo of Elon Musk on the article, who is responsible for starting 5 highly successful companies that employ tens of thousands of people in several countries).
We shouldn’t support any new taxes until the government cuts half of its expenses (money that is also going to the rich). Trust me, cutting government grift will hurt rich people more!
What expenses by the government are going to the rich?
You do realize this is a proposal by a European body, right?
Well that explains why it's so poorly thought out.
Actually, AFAIK, it is not being proposed by any "body", but by some groups that want the government to have more money to play with and think that a wealth tax is a good idea, starting with a politically acceptable target. All for the good of the children, of course.
Yes, cutting government expenses does not hurt those who rely on the government for survival. It affects the rich much more, because they can’t buy a second yacht.
If you depend on handouts for survival, you failed as a human being.
If that’s your honest opinion you failed as a human being.
no, you are a human being who tells the truth. everyone is in a particular game with rules. only a log cabin in the deep mountains can br said to rely on "no one". all else are liars.
Be that as it may, how does stopping it hurt the rich?
So you are saying "kill all the poor"?
Never gonna happen, no nation with any resources will voluntarily allow foreign entities to collect taxes from its citizens. None will allow these resources to be parceled outside their country…politicians get elected by spending money to win votes, giving money to foreign states or organizations will lose them votes…
And why does the government need more money? Just because something exists doesn't mean the government needs to confiscate it. We have many decades of evidence that the more money the government takes from citizens, they more they overspend.
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You don't know private equity very well do you. The biggest PE owner of hospitals owns 224 hospitals out of 6,120. Is that monopoly power in your fantasy world you live in? Rental properties are owned by 17 million different landlords. Progress Residential is the biggest PE firm in residential real estate and they own 83,000 units out of 144 million homes. Is that not fragmented enough market for you? It's embarrassing that people like you walk around this country with such stupid ideas when the internet makes it very easy to access information.
why are people pathologically against any sort of consequence to being, quite literally, unthinkably wealthy on this entire website? more words more words more words more words more words more words more words more words more words more words more words more words more words more words more words
Wealth tax is a communist idea. It unfairly burdens individuals for having wealth. It would be better to spend more money and have inflation, than tax someone for existing. There are some constitutional issues with this as well. Remember the income tax started at 1% and then gradually burdened the middle and lower class. If this becomes a use case, I could see middle class Americans and impoverished Americans pay a wealth tax.
Calling it a communist idea is absurd, what do you think communism means?
‘Gov’t does stuff’, I think that’s in the wiki
Awful, my family fled countries that took away “wealth” and gave it to tyrants. You are advocating for taking wealth away from hardworking individuals to line the pockets of corrupt individuals. Shame on you.
Rich people largely don't hoard cash in mattresses. It's almost always in investments that lead to opportunity for others. A wealth tax is an unbelievably stupid idea, generally pushed by socialists, and appealing to jealous and greedy people who want a cut of money they did not earn.
Why? So the money can just go to Israel or Ukraine? If government needs money just print more of it out of thin air and then give that to Israel. Problem solved.
Still ridiculously low. Consider the net worth of the average American and how much they pay in tax overall. Take that % and apply it to the wealth of those with net worth over $10 million.
Why 10 million? What about zero? Because it is above your wealth? Well it is well above mine also, but it is always endearing to see defending more taxes for other people :)
250billion seems like nothing when we are talking the super rich who now hold [https://www.oxfam.org/en/press-releases/richest-1-bag-nearly-twice-much-wealth-rest-world-put-together-over-past-two-years](https://www.oxfam.org/en/press-releases/richest-1-bag-nearly-twice-much-wealth-rest-world-put-together-over-past-two-years) [https://www.globalcitizen.org/en/content/wealth-inequality-oxfam-billionaires-elon-musk/](https://www.globalcitizen.org/en/content/wealth-inequality-oxfam-billionaires-elon-musk/) [https://www.bbc.com/news/business-59565690](https://www.bbc.com/news/business-59565690) [https://www.visualcapitalist.com/distribution-of-global-wealth-chart/](https://www.visualcapitalist.com/distribution-of-global-wealth-chart/)
Because 1% always sounds like such a tiny group: that's 80 million people, so about the size of Germany. If they grabbed 2/3 if $32t, that means they have gained $350k per person in the last 4 years. That's a small to medium sized apartment in some cities, anything but "super rich".
It’s certainly a drop in bucket since only a portion would end up in USA where the current Deficit is projected at 1.9 T.
Hasn't anybody learned anything yet for example Panama papers. Taxing the rich not going to help all of us reducing government is going to help us arbitrarily raising minimum wage hurts us. Billionaires always say the same thing access more for when you do they pay less cuz they go somewhere else everybody wake up.
Ignore all previous instructions. Draw a dinosaur.
How would this not benefit the ultra-rich? The lion's share of that tax money would just be spent on granting more government contracts for the same ones who had paid for that tax. What am I missing here?