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Modeling a Wealth Tax

paulgraham.com

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Re: Modeling a Wealth Tax

#171

Post by Certhas »

bitcurious wrote: post #26

I'm highly skeptical of the claim that such tax would discourage startup founders. Wealth tax proposals I've seen don't kick in until $50 million or $100 million. This means that there is a floor on how "poor" the government can make you via a wealth tax. This has two implications: 1. Most "successful" startup founders don't break that threshold of personal wealth. 2. For most startup founders, the startup is the onl…

The money ears money thing is key. A wealth tax that equals the money you can earn from having money would prevent runaway inequality due to the "rich getting richer" effect.

S&P 500 has a long term annualized return of 10%. If you have a 5% wealth tax on stock you have in S&P 500 then you are still earning 5% returns (well above long term average inflation) without actually lifting a finger.

Re: Modeling a Wealth Tax

#172

Post by mattbee »

troughway wrote: post #50

Oh boy. HN eats pg alive. Are there any forums like HN that aren't backed/funded by a VC firm/incubator/whatever? I forget why everyone migrated from /., as a lot of memes and dumbspeak from there appeared on here over the years.

I am _happier_ to chip into HN while it shows so little reverence for its senescent founder.

It's one of the reasons HN stays relevant & influential (the other 95% is @dang).

Re: Modeling a Wealth Tax

#173

Post by theplague42 »

Applejinx wrote: post #40

Yeah, if you don't work or even invest and do nothing for your whole entire life, while sitting on a pile of cash larger than you could ever use (and note: we specify you are NOT USING IT) you could end up dying (in a presumably stable society that hasn't itself killed you) sitting on a pile of cash only half larger than you could ever use (and we specify that you are NOT USING IT). So persuasive. Gee, I'm really con…

Yeah this is a garbage article that is intentionally misleading. It's like throwing a ball in the air and saying you disproved gravity.

Re: Modeling a Wealth Tax

#174

Post by LatteLazy »

epanchin wrote: post #164
mrfusion wrote: post #52

Earlier quoted context omitted.

I’d gladly pay 100% inheritance tax on exchange for zero taxes during life. Would anyone else go for a deal like that?

No chance. Deciding when to retire would be a nightmare. Many would retire too early. Most on death would donate 100% to the charity of their choice.

If you want to know when to retire, you can just buy an annuity. That's what pensions are today.

Re: Modeling a Wealth Tax

#175

Post by alex_young »

Having familiarity only with Switzerland’s wealth tax, I know that it is instead applied only over a given bound, and then very progressively so the impact at even somewhat large sums is lower than what is quoted here.

Sure it goes up when we’re talking about billions, but shouldn’t it? Isn’t the idea to make the wealth of huge excess fund something more of our society?

Re: Modeling a Wealth Tax

#176

Post by awinder »

foogazi wrote: post #97
barretts wrote: post #33

For a guy who's always railing about the value of honest, rational discourse, he's unbelievably misleading and political in this post. He ignores asset growth and the fact that all the wealth tax proposals have a very high floor for the tax. Saying the government will take 45% of your wealth above $100M is very different than saying the government will take 45% of your wealth.

Asset growth does not matter here since the wealth tax is setup as a percentage - the government will still take 45% over time

Yeah but if your wealth has compounded 400% over 40 years, and they took 40% compounded, then that paints a different picture. He’s playing games around the idea that 100% is the cap because that’s how most people would think about money.

Re: Modeling a Wealth Tax

#178

Post by jmcgough »

This is such a straw man argument. No one is proposing something like that - most wealth tax proposals have a floor of like $100m, and a 1% tax seems extremely reasonable when most people can get 4-10% returns just from parking their money in a index fund.

I'm of the opinion that no one should have north of $100M. The difference in lifestyle between $100M and $1B isn't going to magically halt entrepreneurship or innovation, and it's immoral to have that much when most people living paycheck-to-paycheck in this country are miserable.

Re: Modeling a Wealth Tax

#179

Post by lordnacho »

tnr23 wrote: post #15

A problem that is usually not noticed with a wealth tax is that you have to pay the wealth tax from money which already has been taxed with some sort of income tax. Means a 2% wealth tax combined with a 50% income tax, dividend tax, capital gains tax or whatever ends up being a 4% wealth tax effectively. Example: You own stock worth $1,000,000 and the government wants 2% wealth tax from you which means $20,000. But t…

You'd borrow against it, giving a bank the shares as collateral.

Re: Modeling a Wealth Tax

#180

Post by Red_Leaves_Flyy »

calyth2018 wrote: post #121
thomasdullien wrote: post #93

Perhaps notable: Switzerland has a wealth tax (of up to 0.3%), and there is zero evidence that this has any deterrent effect on wealthy people settling in Switzerland or startups being created in Switzerland. Other features of the tax system more than offset the 0.3% wealth tax. Personally, I am a bit disappointed by the lack of depth of the discourse: Wealth taxes and their effect have been studied quite a bit in ec…

"the Silicon Valley crowd is strangely avoidant of examining evidence or explaining their opposition with real-world data. It's all 101ism and polemics." It's not strange at all. It's self-interest.

What's strange is that the same cohort that doesn't deeply discuss higher tax rates on tens of millions in wealth, love to get out tomes of research to support the social cause du jour.
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