Agreed with the principle, but there are non-trivial challenges to designing and implementing such a system, not least that the wealth of the 0.1% tends to be highly illiquid - tied up in property that takes forever to sell, or shares whose value will crash if the owner is forced to sell them to pay taxes. Eg see how difficult it was for Elon Musk to buy what was then called Twitter despite his net worth on paper being much greater than Twitter's valuation - because of illiquidity that purchase took nearly a year, and that was for something he *wanted* to buy as opposed to a tax he'd have pulled every trick in the book to avoid.
Obstacles to be overcome, of course; not excuses to duck the challenge. But it's a little bit more complicated than "just" creating a wealth tax.
I don't agree with you that this is a serious challenge. Here you are privileging the ultra-wealthy suggesting that because they're illiquid it'll be difficult for them—boohoo. It would actually be very beneficial for the ultra-wealthy to sell some assets because this would cause economic growth and potentially free up housing capacity. Also suggesting that Musk paying $44 billion for Twitter is comparable to contributing to a wealth tax is just absurd. He took out massive loans to pay for it, which is exactly what the ultra-wealthy can do if they don't want to sell their assets. In any case it is an ultra-wealthy problem, not a government problem. It's important not to have sympathy for people who may need to sell some assets which won't effect their standard of living in the slightest but would matter massively to the 99%.
Okay, can we please step away from the emotive language about who does and doesn't deserve sympathy? Or indeed putting words in my mouth about where my own sympathies lie?
It's important to kick the tyres even of a good idea, to confirm that it is in fact a good idea and to fix potential problems with it. Your point that superrich folks can't necessarily spend the money directly but they can use it as collateral for loans if required is a good one that I hadn't considered. (But that's why it's necessary to kick the tyres! You can be sure that the actual rich people in the real world who are heavily financially motivated will be kicking the tyres as hard as they can, and the idea has to stand firm.)
Hi Alex, it is my personal belief that the philosophy of a wealth tax is to make what is currently a disproportionate system fairer.
With that in mind, I believe settling for 50% of what is owed from someone just because they’re rich undermines the conviction of the tax in the first place.
Do we accept that workers only pay 50% of the tax they owe? No.
You are right that a wealth tax needs to be thought through if it is to succeed. However, I don't think it is in any of our interests to worry how the ultra-wealthy find say 2% of their net wealth (over £10million) a year to pay in tax. If you have over £10 million in assets, it's incredibly unlikely you're even managing your own assets, someone else will be paid to do it.
I think a much more likely problem is that they under value their assets, or hide certain assets (like art) to pay less tax. However, HMRC can be expanded to deal with this. And it would not cost much to empower HMRC comparative to the potential tax revenue that could be generated.
Ultimately, a wealth tax is a partial straightforward solution to complex problems. The actual implementation may raise certain difficulties, but it is clear that collecting resources to feed back into the system will aid in the rebuilding of collapsing public institutions.
This is fair - and thank you for lowering your tone here!
In terms of undervaluation of assets etc, even if that happens and a wealth tax only retrieves say half of what it "should", that's still an improvement on the status quo is it not?
Agreed with the principle, but there are non-trivial challenges to designing and implementing such a system, not least that the wealth of the 0.1% tends to be highly illiquid - tied up in property that takes forever to sell, or shares whose value will crash if the owner is forced to sell them to pay taxes. Eg see how difficult it was for Elon Musk to buy what was then called Twitter despite his net worth on paper being much greater than Twitter's valuation - because of illiquidity that purchase took nearly a year, and that was for something he *wanted* to buy as opposed to a tax he'd have pulled every trick in the book to avoid.
Obstacles to be overcome, of course; not excuses to duck the challenge. But it's a little bit more complicated than "just" creating a wealth tax.
I don't agree with you that this is a serious challenge. Here you are privileging the ultra-wealthy suggesting that because they're illiquid it'll be difficult for them—boohoo. It would actually be very beneficial for the ultra-wealthy to sell some assets because this would cause economic growth and potentially free up housing capacity. Also suggesting that Musk paying $44 billion for Twitter is comparable to contributing to a wealth tax is just absurd. He took out massive loans to pay for it, which is exactly what the ultra-wealthy can do if they don't want to sell their assets. In any case it is an ultra-wealthy problem, not a government problem. It's important not to have sympathy for people who may need to sell some assets which won't effect their standard of living in the slightest but would matter massively to the 99%.
Okay, can we please step away from the emotive language about who does and doesn't deserve sympathy? Or indeed putting words in my mouth about where my own sympathies lie?
It's important to kick the tyres even of a good idea, to confirm that it is in fact a good idea and to fix potential problems with it. Your point that superrich folks can't necessarily spend the money directly but they can use it as collateral for loans if required is a good one that I hadn't considered. (But that's why it's necessary to kick the tyres! You can be sure that the actual rich people in the real world who are heavily financially motivated will be kicking the tyres as hard as they can, and the idea has to stand firm.)
Hi Alex, it is my personal belief that the philosophy of a wealth tax is to make what is currently a disproportionate system fairer.
With that in mind, I believe settling for 50% of what is owed from someone just because they’re rich undermines the conviction of the tax in the first place.
Do we accept that workers only pay 50% of the tax they owe? No.
You are right that a wealth tax needs to be thought through if it is to succeed. However, I don't think it is in any of our interests to worry how the ultra-wealthy find say 2% of their net wealth (over £10million) a year to pay in tax. If you have over £10 million in assets, it's incredibly unlikely you're even managing your own assets, someone else will be paid to do it.
I think a much more likely problem is that they under value their assets, or hide certain assets (like art) to pay less tax. However, HMRC can be expanded to deal with this. And it would not cost much to empower HMRC comparative to the potential tax revenue that could be generated.
Ultimately, a wealth tax is a partial straightforward solution to complex problems. The actual implementation may raise certain difficulties, but it is clear that collecting resources to feed back into the system will aid in the rebuilding of collapsing public institutions.
This is fair - and thank you for lowering your tone here!
In terms of undervaluation of assets etc, even if that happens and a wealth tax only retrieves say half of what it "should", that's still an improvement on the status quo is it not?