I think a tax on unrealized cap gains is way too clunky in theory to ever be practical to apply. My preference would be for a tax that works similarly to a property tax but that applies to investment assets.
Yeah, there are two ways in which this proposal relates to existing policies/political positions: 1. Property tax: an existing tax on the nominal value of a somewhat illiquid asset. 2. Gentrification: Opposition to gentrification often comes from the Left precisely because owners sitting on large *unrealized* capital gains can have problems paying ever increasing property taxes. In both cases the problem of gains on illiquid assets are already known, and quite frankly, unresolve.d
If they want to tax the rich why would they not tax stocks the same way that real estate is taxed? By taxing 1% of the value of stocks every year. They could tax you by the lowest value of your stocks every year. It would be easier tax to pay then paying 1% property taxes every year which really hurts the poor.
Couple of reasons. The federal government doesn't tax real estate. Property taxes are from state and local governments to pay for local services like roads and schools. Since those services are tied to locations, they tend to do the same with the taxes. Second, taxing stocks would hurt poor people too. Pension funds hold stocks. People's retirement accounts mostly hold stocks. The last thing I'll say is that societally, I know there's this impression that wealthy people aren't paying their fair share. But the top 1% of income earners pay over 40% of the income tax collected by the IRS. The bottom 50% pay less than 5% of the total. We *are* taxing the rich. We just spend way more than we take in.
thanks for the clarity.
I think a tax on unrealized cap gains is way too clunky in theory to ever be practical to apply. My preference would be for a tax that works similarly to a property tax but that applies to investment assets.
Yeah, there are two ways in which this proposal relates to existing policies/political positions:
1. Property tax: an existing tax on the nominal value of a somewhat illiquid asset.
2. Gentrification: Opposition to gentrification often comes from the Left precisely because owners sitting on large *unrealized* capital gains can have problems paying ever increasing property taxes.
In both cases the problem of gains on illiquid assets are already known, and quite frankly, unresolve.d
If they want to tax the rich why would they not tax stocks the same way that real estate is taxed? By taxing 1% of the value of stocks every year. They could tax you by the lowest value of your stocks every year. It would be easier tax to pay then paying 1% property taxes every year which really hurts the poor.
Couple of reasons. The federal government doesn't tax real estate. Property taxes are from state and local governments to pay for local services like roads and schools. Since those services are tied to locations, they tend to do the same with the taxes. Second, taxing stocks would hurt poor people too. Pension funds hold stocks. People's retirement accounts mostly hold stocks.
The last thing I'll say is that societally, I know there's this impression that wealthy people aren't paying their fair share. But the top 1% of income earners pay over 40% of the income tax collected by the IRS. The bottom 50% pay less than 5% of the total. We *are* taxing the rich. We just spend way more than we take in.