You are a successful capitalist and you are proud of your wealth because they can invest their capital better than most people. You are also politically savvy and can see the direction of the wind: this is not necessarily in your favor. Therefore, you agree that some changes must be made to make the economy work for everyone, or at least keep the pitchfork locked.

What changes should you support? Paradoxically, you may want to recognize net wealth tax.

To be sure, the tax burden on capital owners will increase.Spend more determination Public Service and Investment Is the strongest in decades. Therefore, when capital wealth grows faster than income growth (the ratio of wealth to GDP) Doubled since the 1980s), the relative contribution to the public wallet should follow.

This ever-changing political atmosphere is a futile trend for capital owners. Instead, they should promote the form of taxation that is most beneficial to themselves and capitalism itself.improving Net wealth tax It is an annual levy on the taxpayer’s net asset value (its total assets minus its debts), and the tax rate is higher than the tax allowance.

Only a few countries own these countries, but they include some of the most successful economies in the world, such as Switzerland and Norway.In the United States, people have proposed a property tax Elizabeth Warren And Bernie Sanders, the two left-most candidates in the last presidential election.so far The Biden Administration’s willingness to increase taxes No willingness to consider this tax has been shown. Successful capitalists should hope that this situation can be changed.

All countries already levy taxes on wealth holdings. They just rarely tax them regularly. Conversely, when assets are converted from one form to another, taxes are imposed on the assets, such as realized capital gains tax and transaction stamp duty, or when transferred from one person to another, such as inheritance tax and gift tax. In addition, all countries impose recurring taxes on wealth in the form of real estate.

All these make the operation of capitalism worse. Taxing wealth only during the transaction will reward hoarding, rather than deploying or redistributing capital to the most productive use that capitalists consider to be the most productive. This is also not conducive to passing on wealth to future generations when young people make full use of their wealth.

The incentives created by existing wealth taxes are not only inefficient. Some of them are totally unfair. In fact, inheritance taxes and gift taxes impose a lighter asset burden on people who live longer or accumulate wealth than those who die prematurely or transfer assets more quickly. Property taxes are levied on total capital wealth, so people with 90% mortgages pay the same tax rate as people who own the exact same property, and are ten times their wealth.

Capital gains tax By taxing only the incremental growth of wealth and making losses deductible, penalize those who make the best investment choices. It also ignores that the ability to pay taxes depends on a person’s total holdings, not the amount of increase. In short, such a system redistributes from billionaires with high investments to billionaires with poor investments. A net wealth tax is the opposite.

Net wealth tax is also better than capital gains tax (corporate profits, dividends and interest income). What they all have in common is that the greater the profit from a given amount of capital, the more taxes you pay. Again, if you invest a poorly invested billion dollars, you may have to pay less tax than a well-invested one million dollars.

For net wealth taxes, the tax burden has nothing to do with income. Therefore, the most successful investors will retain more returns and see their capital accumulate faster.It is the taxed version of the New Testament Allegory of Talent.

Over time, this will put more economic capital in the hands of those who distribute it properly. This model rewards success and enhances the potential of capitalism for creative destruction. Over time, a progressive wealth tax will also support the growth of less concentrated wealth, which will grow more moderately but more frequently.

As a result, of all the ways in which capital is taxed, a progressive net wealth tax is the most capitalist-friendly system and the most supportive of a democratic system of property ownership. Of course, in the long run, this is of course the most suitable social model for capitalists, even for ultra-rich but unhealthy investors whose wealth tax will be hit hardest.

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