You are a successful capitalist and proud of being rich by investing the most in your own capital. You are also politically aware enough to see how the wind blows: not necessarily for your convenience. So you agree that the economy needs to change a bit to make it work for everyone, or at least stick to Pitchforce.
Which changes should you support? Surprisingly, you may want to approve net asset tariffs.
It is certain that the tax burden on capital owners is going to increase and there seems to be a determination to spend more Public services and investment It is the strongest in decades. The spiritual concept is when capital wealth grows faster than income (wealth from the ratio of gross domestic product) Has doubled since the 1980s), The issue of relative contribution to the universal purse should be followed.
This changing political climate is a trend that capitalists will resist in vain. Instead they should rush to the form of tax that is best for both capitalism and itself. A progressive Net assets tax An annual tax on the total value of taxpayers – their total assets less than their debts – is paid at an increasing rate above the tax-free amount.
They have a handful of countries, but they include some of the world’s most successful economies, such as Switzerland and Norway. An asset tax has been proposed in the United States Elizabeth Warren And Bernie Sanders, two left-wing candidates in the latest presidential election. Until now The Biden administration is willing to raise taxes These national tariffs do not express an appetite for consideration. Successful capitalists should expect change.
All countries already tax wealth holdings. They rarely pay their taxes on a regular recurring basis. Instead they impose duties on assets when they are exchanged from one form to another, such as when they are transferred to another person, with capital gains tax on transactions and stamp duty on inheritance and gift tax. Moreover, all countries levy recurring taxes on assets in the form of real estate.
All this capitalism works less well. Rewards are more rewarding than just reassessing capital for what is considered to be the most productive use of capital by the capitalists during the transaction. It encourages wealth to the younger generation so that they can take advantage of it.
Encouraged by existing wealth taxes are not only inefficient. Some of them are simple distortions. Inheritance and gift taxes result in the acquisition of more property than those who live longer or whose assets die or pass away sooner, imposing a lighter burden on their assets. Property taxes are levied on gross capital assets, so anyone with a 90% mortgage pays the same as the direct owner of the same property and ten times richer.
Capital tax Punish those who only tax the incremental growth of wealth and choose the best investment to make the loss deductible. Ignoring this, however, the ability to pay taxes depends more on its total holdings than on the amount it goes through. Simply put, in such a system of governance, millionaires redistribute from those who make bad investments to those who make good investments from billionaires. A net asset tax must be reversed.
The principal asset tax also compares favorably with the income flow tax from capital – corporate profits, dividends and interest income. There is a similarity between them that the higher the profit you make from the given amount of capital investment, the more tax you will pay. .
With a net asset tax, the tax burden is independent of the return. It follows that the most successful investors will keep some of their returns and see their capital accumulate more quickly. This is the tax version of the New Testament Talent examples.
Over time, this will put the capital of the economy better in the hands of those who allocate it. The model rewards success and strengthens the potential of capitalism for creative destruction. An asset tax that is also progressive, over time, supports the development of less concentrated assets – more modest but more often the fate of good investments.
The impetus is that, among all the methods of capital taxation, a progressive net asset tax is the most conducive to capitalist-friendly and property-owned democracy, and it is, of course, the social model that best suits long-term capitalists – even the super-rich but the worst. Investors, whose property taxes will suffer the most.