Taxing savings makes sense over income. Why tax someone producing, removing the tax encourages more work performed. We tax income because it is easier. We tax the estate in death because everything is collected and recorded. In Roman times they sent a tax collector who would go through the home to find valuable objects to pay taxes (tax on savings).
It is not as wierd as it sounds. It's impossible to implement in our society before death and taxing payrolls and self reported income is a lot easier.
But that is a bad goal - we don't want to optimise economic flows, we want to optimise quality of life and standards of living.
The goal in this era of plenty shouldn't tend towards everyone teetering towards bankruptcy and wage slavery so that the politicians can talk about how the GDP is 2% higher. Everyone should have a reserve of real wealth in case they fall on hard times and the bigger the reserve the better as far as I'm concerned.
In my lifetime there have been a constant stream of inflationary collapses and a noticeable lack of problems caused by deflation. That theory is very popular with governments because it justifies the creation of money on a grand scale, but it has a certain lack of evidence. We've seen communism tried more often than deflation.
Heh it's a great idea for the powers collecting that spending though ;)
It happens all the time, it's called property taxes.
Not exactly, if the government prints money, then the value of the dollar will decrease, but it the value of other assets will increase to adjust for the lower dollar value. So while printing money can be thought of as a tax on cash savings, it's not a tax on all assets (e.g., stocks, property, etc.).
Perhaps in some cases, but many companies I know have "spend it or lose it" policies wrt budgets, so often money gets spent just to justify being able to spend more next year. And I've worked with a couple small companies that tried to spend more (legitimately) to try to avoid having as much profit to pay tax on. So not every business tries to minimize cost (or not as efficiently as you might assume).
Arguably not. The progressive tax bracket system means that a bare minimum amount of money (up to the lowest threshold) is available basically tax free to cover necessities and then everything above that is effectively profit for an individual. Living in an expensive house, eating expensive foods, raising a well resourced family aren't really expenses in the sense that businesses have expenses. If they were like business expenses people would try to minimise them, whereas most people I know actually try to maximise those costs when you look at what decisions they make. I've never convinced anyone with arguments that they should move into a cheaper house to save money. In that sense, both systems are philosophically the same but people have very low necessary expenses.
Almost an aside, but taxing people only on their savings would be truly bizarre. Someone measurably adds more to the economy than they consume and they are the ones who get shafted with tax? Ethically a case could be made, but practically the incentives are so nutty I'd hope it doesn't warrant serious discussion.
Taxing corporate revenue rather than profit would cause price increases and act like a consumption tax. Certainly possible, but that is a regressive tax policy and generally frowned upon.