You're sitting on greater than 50 million dollars? That what a wealth tax would most likely target
Outside of Disney comic books, money doesn't sit around.
The money "in" my savings account is just bits in a database. The value it represents has been loaned by the bank to someone who is doing something with it.
When I sell stock to pay a tax, the money to pay that tax has to come from someone who bought it. That value represented by that money is value that won't be used for other things.
Are you certain that what govt will do with that value is better than what those someones are doing with it? That's the question because taxing me means that they won't have that money and govt will. (Taxation doesn't create value - it moves it.)
All of the talk about roads and stuff is somewhat dishonest. Transfer payments dominate govt spending, not production of goods and services.
> That what a wealth tax would most likely target
Ah yes, the "the tax will only affect bad things" rule. Is there any good reason to believe that the folks who are pretty much responsible for the current tax system will somehow figure out how to do this correctly?
Your belief about "money just sitting around" is not encouraging.
When things go south, we'll hear about the value of breaking eggs, but for some reason the omelets don't show up.
If an economic agent holds a money, they are -- by definition -- saving their money. If they instead decide to speculate with the money "Hmm I think gluten-free bread will be in higher demand next year, better buy ovens today, to sell to the baker then" they consume scarce resources (labor and materials to make the oven). If they invest the money in a business endeavor "Hmm I need to allocate capital from money to wheat, ovens, to turn a profit as a baker to produce bread" they consume scarce resources. These capital allocations change the exchange rates of these goods.
Try as you might to avoid it, all forms of punishing cash holding induces undue consumption.
We're talking about multi-millionaires, often in the tens of millions, and more.
No-one is saying that regular Joe's with $800 in their savings account should be penalized for just letting them sit.
Does no one in this thread understand that there already exists wealth taxes in countries without explicit wealth taxes?
While many countries have explicit wealth taxes (Government agency that will demand you pay x on y), many (almost all) countries have wealth taxes that tax "regular Joe's with $800 in their savings account". The central bank in the USA literally has a charter to print enough money so that asset prices rise at a nominal 2%PA. If a central planner confiscates $16 in purchasing power from regular Joe does it matter if its done through direct taxation (taking the $16 dollars) or indirectly (printing enough money so that his future value of $800 will be only $784)?
Since you need it spelled out again: unlike inflation, actual wealth tax will not take $16 from your Joe because in case of actual wealth tax, $800 is three or four orders of magnitude below minimum taxable amount of savings.
Currently many countries have, or are proposing additional wealth taxes that are graduated in amount (What the original article is discussing).
>blame wealth tax for the faults of inflation
Who made this argument? Not me. You've misrepresented me pointing out that engineering inflation is a tax on all wealth (including average Joe's $800)
Best of luck to you in thinking that people writing words in a book in marble buildings can magic more food into existence.
Wealth tax would only apply to the very reach. i.e. the “job creators” whose wealth is supposedly “trickling down” the economic ladder.
Ah yes, the economic argument of "punish savers and people refraining from consumption will lead us to our Centrally Planned Utopia"
>If you have a bucket of money that isn't doing anything, then what value does it actually bring to the economy?
Do you and I live in the same reality? When a global pandemic has shown almost every single person on earth that cash balances should have been higher -- enough to sustain unexpected periods of inactivity -- it seems a little tone deaf to say saving money is unproductive. There's already a tax on holding central-bank money -- it's called engineer inflation and it's what's exacerbated the economic repercussions. Your Central ~~Bankers~~ Planners convince you taxing fiat money holdings (price inflation) and artificially reducing the cost of bringing future production to the present (downward interest-rate manipulation) will lead us to utopia when it's actually cause over consumption, over production, and a planned economy on the precipice of collapse.
I'll keep the "unproductive" savings, thanks.