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Global wealth inequality- 62 people are now as wealthy as world's 3,6 billion poorest
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Brodiaga Offline
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RE: Global wealth inequality- 62 people are now as wealthy as world's 3,6 billion poorest
Another devil's advocate here.

What's wrong with taxing excessive wealth (net worth) along the lines of what Pickety recommends in his book Capital in the 21st Century?

Let me clarify what I mean by that. This is not from the book, just my own idea. There is a certain amount of money which a person needs to be very well off and never have to work again for the rest of his life. The amount itself is debatable, but let's say it's $10 million net worth per person. Using the 4% draw rule, $10M is likely to generate $400K/year or more in passive income for lifetime.

So, what's wrong with setting this amount as a floor (adjusted for inflation) for an asset tax and taxing everybody who has more than that at 5% of net worth per year? Suppose the US imposes such a tax and other countries follow, so the ultra rich can't play the usual tax arbitrage/avoidance game on this one. 5% is not confiscatory. With access to the best investment opportunities and advisers that the ultra rich have, they'll be able to make more than 5% return on capital, so this tax is very unlikely to cause them to deplete their savings over time. Using this additional tax revenue, governments can reduce the income tax and other taxes for the middle and lower classes. This will result in more equitable distribution of wealth.

Alternatively, there may also be a sliding scale wealth tax, let's say 1% on net worth over 5 million, 5% over 10 mil, 10% over 100 mil etc with a ceiling of, for example, 20%.
(This post was last modified: 01-21-2016 07:49 PM by Brodiaga.)
01-21-2016 07:42 PM
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RE: - zero1 - 01-21-2016, 07:33 PM
! - DjembaDjemba - 01-21-2016, 12:11 PM
RE: Global wealth inequality - poutsara - 01-21-2016, 11:24 PM
RE: Global wealth inequality- 62 people are now as wealthy as world's 3,6 billion poorest - Brodiaga - 01-21-2016 07:42 PM

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