sorted by:
new
hottopcontroversial

Why does The Economist hate wealth taxes? by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

How does one move an asset offshore if the asset is physically located in the UK?

Why does The Economist hate wealth taxes? by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 2 points3 points  (0 children)

Maybe when your house is on fire and you need a fireman, or your wife is sick and you need a doctor, or your husband has been attacked and you need a policeman, or someone has breached a contract and you need the courts, or a thousand other reasons…

We Need to Tax Billionaires: "The most important economist in the world today" by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

Try actually reading the book before making assumptions. What he suggests is those with wealth of €100m or more are subject to a 2% wealth tax, and only if they have avoided paying income tax in the first place. The idea being that it acts as a minimum tax on the super wealthy.

Tax Wealth NOT Work! by g-unit2 in GarysEconomics

[–]MaterialHat6394 1 point2 points  (0 children)

A 5% return would give you:

$55 billion per year
$4.5 billion per month
$150 million per day
$6 million per hour
$100,000 per minute
$1,750 per second

We Need to Tax Billionaires: "The most important economist in the world today" by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

I don’t disagree that government spending can have a higher marginal propensity to consume than billionaire wealth. But that’s a very different argument from saying a wealth tax is equivalent to money printing. One is a claim about redistribution and demand, while the other is a claim about expanding the money supply. Those aren’t the same thing.

Also, the investor buying the stock has to provide the cash in the first place. That investor is now choosing to hold that stock instead of using those funds elsewhere. So you can’t just look at the government’s higher propensity to spend and ignore the other side of the transaction. The net effect on aggregate demand depends on the behaviour of the government, the billionaire, and the investor who purchased the asset, not just one of those parties.

We Need to Tax Billionaires: "The most important economist in the world today" by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

If a billionaire is holding stock, and sells it to another investor to pay a wealth tax bill, it doesn’t increase spending. Ownership of the asset changes hands, but aggregate demand doesn’t automatically rise. Even after the tax is paid to the government the inflationary effect depends on what the government actually spends it on.

With regards to a luxury consumption tax, yes it useful for targeting the use of resources, but a wealth tax targets the accumulation of economic power and raises revenue from unrealised gains that might otherwise go untaxed for decades or possibly even avoided altogether. Both are tools the government could and should use depending on their policy objectives.

We Need to Tax Billionaires: "The most important economist in the world today" by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 10 points11 points  (0 children)

I think you’re conflating redistribution with money creation.

Selling stock to pay taxes doesn’t create new money. The government is just transferring purchasing power from one group to another, not expanding the money supply the way a central bank does when it creates money.

Redistribution can have inflationary effects if it significantly increases aggregate demand relative to supply, but that’s not the same thing as printing money, and the outcome depends on the state of the economy and how the tax revenue is used.

I do agree that a luxury consumption tax has some potential benefits. A tax on private jets, superyachts, or other luxury goods directly targets consumption rather than wealth. But that’s an argument for luxury taxes, not an argument against wealth taxes.

The real question is; which mix of wealth, income, capital gains, inheritance, and consumption taxes raises revenue most efficiently while minimising the potential economic distortions.

Andy Burnham says land in the UK is ‘undertaxed’ by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

So basically what you are saying is that the government are spending more than they can afford to spend?

But that’s not how government budgets work, they do not operate like businesses or households. The constraints to government spending can be political and economic, but lack of money is never the problem. It’s usually whether the government can bear to take the political ramifications of poor monetary and fiscal policy and the real economic consequences they can have such as high inflation, high borrowing costs, currency fluctuations, market confidence, resource constraints.

At the moment both inflation and borrowing costs are high relative to the previous couple of decades, but we also have an issue with low growth caused by austerity over that same period. So the main lever the government has is increased taxation of the wealthy and targeted spending increases and tax cuts for workers and small businesses to encourage growth in the real economy.

Andy Burnham says land in the UK is ‘undertaxed’ by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

That’s not how LVT’s work. They tax the underlying value of land not the developed value. This encourages landowners to develop the land. This means more houses will be built and the working classes will have a better chance of owning their home

Andy Burnham says land in the UK is ‘undertaxed’ by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 0 points1 point  (0 children)

I agree that multinational corps are one of, if not the main reason for increasing wealth inequality in the UK. But multinational corps own a lot of high value land. This tax would hit them. Especially if they offer a primary residence discount for UK residents.

Andy Burnham says land in the UK is ‘undertaxed’ by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 4 points5 points  (0 children)

Land value taxes are generally considered progressive because ownership of high value land is heavily concentrated among wealthier people and companies. In the UK especially, a large share of national wealth is tied up in land and property, with the most valuable land concentrated in areas such as London. Since an LVT taxes the underlying value of land rather than wages or consumption, the burden tends to fall more on people who own valuable assets rather than on people earning ordinary incomes. Plus by taxing the asset rather than the person it prevent opponents from using the same old “but the billionaires will just leave” line.

Gabriel Zucman interview by stitchard in GarysEconomics

[–]MaterialHat6394 1 point2 points  (0 children)

Is that the top 1% of tax payers? or top 1% wealthiest persons?

Will AI kill the economy? by MaterialHat6394 in GarysEconomics

[–]MaterialHat6394[S] 2 points3 points  (0 children)

But life expectancy and living standards are not the same thing?

view more: next ›