It’s pretty easy, hit dividends, income for social security and Medicare purposes without caps, etc. Eliminate deductions for margin interest, tax filing, legal, orgs fees. Put an excise tax on LLC formation and annual reporting, and require an annual filing of beneficial owners of corporate entities. Charge a higher fee for foreign and corporate owners.
Basically take all the loopholes that the .01% use and close or disadvantage them so they don't use them (or as much).
Rich still get richer but the system stabilizes.
My house isn't very liquid, can't generate revenue very effectively, and I'm taxed every year on its current value. Guess us regular folks are already subject to a wealth tax.
If you want to say it's difficult to tax illiquid assets, that's fine. But it's not impossible and while it would just change people's relationships to these types of assets (maybe in a good way for society), it's not going to be the end of the world.
And yes, all the reasons why "taxing X would actually be harmful for the economy" somehow magically do not apply to the small fish.
Wealth taxes are a not the best idea. Being taxed on something illiquid that can’t generate cash flow is the pinnacle of dumb taxation. For example, you have a piece of art. You’d have to sell something just to hold onto the art, and if you don’t have anything to sell, you’d have to sell the art itself just to pay for ownership of the art. It would make some sense to increase capital gains taxes instead of slapping people with a wealth tax. I say this as someone that would not be hit by a wealth tax.
Also, the rich can simply move assets out of the country, and then you erode the very thing you want to tax.