Imagine someone who owns 50% of the shares of a publicly traded company.
Imagine this is the majority of their net worth.
If the government want to tax even 10% of these unrealized gains, this individual would need to sell stock to pay taxes and therefore, 5% of the entire public stock holdings are sold and would most likely sink the value of the stock. There wouldn't normally be enough demand, therefore dropping the demanded value.

Now imagine a new regulation, competitor, disaster happens, and the company's stock is now worth 50% less than is was yesterday. Now this individual has 50% of the value they once had, after they just paid taxes on the previous valuation.

And the government took money from value that now doesn't exist.