I always thought of the wealth tax as more of a service charge. Private property is a major government service. Private property, at a minimum, requires a military, a police force, a court system, and a registry system. It needs to be prepared to deal with threats to ownership, domestic and foreign, that have to be met with physical force. It needs a system to keep track of who owns what and a means of resolving disputes between parties. There are other government services as well, but the thing is that the more wealth one has, the more one benefits. Insurance companies know this. They charge more to insure property based on its value.
Most of the wealth we are talking about is government issued money, government allocated land, shares in government chartered collectives and the like. Only a small portion of it is in expensive physical artifacts. Once one stops thinking of it as a tax but rather a service charge, it makes a lot more sense. Income taxes and the like approximate a wealth tax by assuming that the value of an item is in its ability to produce income whether by sale, lease, operation or otherwise.
Very interesting and enlightening read. Thank you!
How do you think a wealth tax that excludes a primary residency, combined with a £500k personal allowance (so first £500k of net wealth outside the family home would be taxed at zero), would be perceived by UK voters? Given 96% of UK housing is a primary residency that would obviously only require the government to value 4% of housing a year for tax purposes.
Do the proposed US "net wealth taxes" to which you refer also take into account liabilities/debts? Levying a tax on the value of a house, with a 90% mortgage, seems more like a gross-wealth tax.
Really fascinating, thanks. It'd be interesting to see whether replacing an inheritance tax (on the giver) with a gift tax (on the recipient) would shift opinions at all - whether it allow politicians to sidestep the 'double taxation' argument at all, even if effectively it's the same thing.
I always thought of the wealth tax as more of a service charge. Private property is a major government service. Private property, at a minimum, requires a military, a police force, a court system, and a registry system. It needs to be prepared to deal with threats to ownership, domestic and foreign, that have to be met with physical force. It needs a system to keep track of who owns what and a means of resolving disputes between parties. There are other government services as well, but the thing is that the more wealth one has, the more one benefits. Insurance companies know this. They charge more to insure property based on its value.
Most of the wealth we are talking about is government issued money, government allocated land, shares in government chartered collectives and the like. Only a small portion of it is in expensive physical artifacts. Once one stops thinking of it as a tax but rather a service charge, it makes a lot more sense. Income taxes and the like approximate a wealth tax by assuming that the value of an item is in its ability to produce income whether by sale, lease, operation or otherwise.
Very interesting and enlightening read. Thank you!
How do you think a wealth tax that excludes a primary residency, combined with a £500k personal allowance (so first £500k of net wealth outside the family home would be taxed at zero), would be perceived by UK voters? Given 96% of UK housing is a primary residency that would obviously only require the government to value 4% of housing a year for tax purposes.
I approached with scepticism but the methodology is interesting. A survey of tax experts would be interesting.
Do the proposed US "net wealth taxes" to which you refer also take into account liabilities/debts? Levying a tax on the value of a house, with a 90% mortgage, seems more like a gross-wealth tax.
Really fascinating, thanks. It'd be interesting to see whether replacing an inheritance tax (on the giver) with a gift tax (on the recipient) would shift opinions at all - whether it allow politicians to sidestep the 'double taxation' argument at all, even if effectively it's the same thing.