<i>> In 2018, Warren Buffett had a net worth of $84 billion. The effective tax rate on his mountain of wealth? 0.006%—orders of magnitude lower than the tax rates paid by most middle-class families.</i><p>What tax rate do middle-class families pay on their net worth? 0% I believe, since we don't have wealth taxes?
It is interesting that everyone says that the wealth tax is hard to implement, yet it seems to be working well in Switzerland?<p><a href="https://www.bloomberg.com/news/articles/2021-02-16/swiss-wealth-tax-rakes-in-cash-as-covid-revives-global-debate" rel="nofollow">https://www.bloomberg.com/news/articles/2021-02-16/swiss-wea...</a>
Most of the “ultra-wealthy” have their wealth in the form of stock in public companies. This is certainly true for the examples she lists. If they’re all going to have to sell 2% of their holdings each year to pay for this wealth tax, who are they going to sell to and where is the money going to come from?<p>It seems like this is a recipe to generate some temporary funding for the US government by selling off our national assets (e.g. ownership of major US companies) to foreign investors.
I have noticed that politicians always use extremes (many standard deviations away from the average) to illustrate a population.For example, Warren Buffet wealth is in the top 10. Yet, Warren's policies target the top 1% (top 10 is the top 0.00033% of the top 1%). He is not representative of the top 1% in any way!! Show me the median and let's talk.<p>I am surprised people bite at this manipulative narrative. It seems to me that it discredits their arguments right away. In that sense, voter education would go a long way.
What if we mandate that all workers must get part of their compensation in the form of company shares so that if the company explodes in value, it's not just the executives that become billionaires and the workers are just still going paycheck to paycheck? This seems common in the tech world but not so much in other companies.
It's always interesting that this issue keeps coming up, whereas Islam solved it over 1400 years ago through the Zakat system.<p>An extremely reasonable 2.5% would be owed on money sitting in the bank for one lunar year (it's a form of "wealth tax" if you will). It has been documented that in Iraq during the Ummayad period where everyone paid their share of Zakat, there were no more poor people left to accept it.<p>And that's it, no income tax or messing around with it. It works.<p>Livestock and produce have a separate calculation, but most of us here are not in that business.
The ultra wealthy, if not breaking the tax law, are paying what the government believes they should pay and are not avoiding anything. Congress wrote, voted on, and passed the tax laws.
In the UK (and I'm sure elsewhere), inheritance tax is the main vehicle to try and avoid dynasties being created once one person has accumulated massive wealth.<p>As others have said, it is income that is taxed, there will be plenty of people who own capital (e.g. inherited a large country house) and who don't have the cash to pay a tax on it and presumably it would seem unfair to force them to sell it (and hope they get decent money for it) in order to pay a tax on it.
One answer would be a federal sales tax, combined with a Universal Basic Income.<p>The UBI would be equal to the amount of the tax on up to some minimum income level (say, 50k / year). In other words, everyone gets a monthly check that is essentially a rebate on their sales tax up to the income threshold.<p>That's simple, loophole-free, and avoids the privacy invasion that accurate income tax collections require.
In theory, a 3% wealth tax makes the life of a billionaire difficult. You have like a 60% tax rate for fed/state/local. You make maybe 8% by being safe in your investments. If you pay taxes on your income, get that 8% reduced to 6% by 2% inflation and then your left with a 3.6% YoY gain (6% * 60%) before a 3% wealth tax wipes you out down to 0.6%.<p>But you still don't have to pay taxes on your gains with this bill. You can take out a loan on your new assets at a 2-3% rate and its reduced to around 1% with inflation. Now you don't have to pay taxes because a loan on the principal value doesn't cause a taxable event with the step up in value. You just sell enough to cover your interest liabilities and pay taxes on that.<p>I wish they'd address WHY these rates are so low by attacking people and companies that aren't being productive with their capital by building things people want. Why attack a people or a company with a wealth tax if they are paying low rates because they spend most of their revenue on building the business. Capitalism is about rewarding good allocators of capital.
Okay I read this.<p>It gives no details on what loopholes would be closed, and then conflated that with tax cheats and that a well funded IRS will solve both.<p>A well funded IRS will just be rubber stamping the compliant tax reducing methods faster. Although most constituent's experience with the IRS is retroactive and adversarial, wealthier people's experience with the IRS is pre-emptive and collaborative. It is a totally different experience.<p>I don't get the impression that the people and organizations identified here would ever be subject to these taxes, even if the law was passed without any debate.
Sigh... Wealth taxes don't work. Almost every single European country that had a wealth tax repealed theirs. The fact that Senator Warren is continuing to try to push a wealth tax shows how poor her policies are.
> Name: Elon Musk, Net Worth: $19.9 billion, Federal Income Tax Paid: $8,410<p>How is this possible? Why does Elon Musk pay less taxes than an average person who works in Tech?
Somehow any new measures will end up penalizing the middle class either directly or indirectly and not touching the ultra wealthy despite the politicians claiming loudly otherwise.
I don't think "escaping taxes" is a bad thing. I'm only upset these instruments aren't available to the common person.<p>This money belongs in people's pockets, not in pockets of senators and their golf buddies.
You can tell how close we are to complete collapse by how hard they agitate for outright wealth confiscation, and how sloppy they are with their attempts at intellectual sleight-of-hand.<p>Like clockwork, from a historical perspective.