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California plan for wealth tax on anyone who spends 60 days a year in the state

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Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#131

Post by amscanne »

tsimionescu wrote: post #114
Enginerrrd wrote: post #102

Earlier quoted context omitted.

While I agree with you that the idea there is fundamentally flawed, it does seem like the greatest increases in GDP and growth have occurred when the pareto distribution of wealth was the least skewed in favor of the wealthy. To an extent, this makes sense to me from a free market perspective... The less concentrated the wealth and power is, the more we can expect competition and innovation. So even though their reas…

But that is exactly their reasoning - not some fantasy of balancing the budget by taxing the rich, but a rationally supported (in history and economic theory) belief that reducing the wealth gap increases economic productivity. Wealth taxes (if they can be enforced, which is a significant problem) are especially powerful in this area, as they reduce the incentive for rent seeking behavior - it stops people from simpl…

No billionaire is just sitting on their money. It’s certainly tied up in assets or being actively managed.

I don’t see in what universe a wealth tax could be effective, given that people can simply move. Wouldn’t it just cause large-scale capital flight, as it did in France?

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#132

Post by Pfhreak »

emteycz wrote: post #128
fattire wrote: post #117

Earlier quoted context omitted.

"wealth he created"

Exactly. How else would it get to his bank account? If he didn't create it, why people sent it to him? He stole it?

Profits are just unpaid wages. He bought labor for less than it was worth and pocketed the excess.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#133

Post by beezle »

throwaway2245 wrote: post #32

This proposal is 0.4% tax on wealth above $30m. The Dutch equivalent is 1.6% tax on wealth above €1m. The number of Ultra High Net Worth Individuals in the Netherlands is still increasing.

Not big fan of taxes in general but I find the whole 'wealth' tax to be especially odious. Why not call it what it is, a pre-death estate tax? If the government is to tariff/tax, it should be done at the time of use or income generation/realization one time. Unfortunately double jeopardy laws seem not to apply to capital.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#134

Post by rhexs »

bgentry wrote: post #84
post_break wrote: post #59

Earlier quoted context omitted.

The problem most Texans see is they flea California, realize it’s different, and vote for the same stuff they had there. A lot of Texans do not want California transplants. Just like how Montana doesn’t want Texans.

Or perhaps they left California for Texas because they didn’t approve of the policies that have made CA a worse place to live, but their vote is in the minority in CA and so they can’t realistically do anything about how broken and dysfunctional the government and policies there are? Speaking as a lifelong Californian who just moved to Austin, and has had to explain this to the few people who espouse the "don't turn…

Unfortunately, as proven by every area that has the "privilege" of receiving new Californian transplants, you are in the extreme minority.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#135

Post by caymanjim »

Trisell wrote: post #95
adjkant wrote: post #68

Well I guess I'll take the apparently bold stance here that this isn't the end of Silicon Valley or California and yes this is fair and further, good. When people are getting 5-6% returns on investments (minimum), 0.4% is still not even stopping the rich get richer effect. Not to mention that it's almost certain no one here will ever be touched by this tax. If you're going to move where you live or significantly alte…

I think your premise that they will experience French Revolution like consequences is overlooking the fact that unlike the 1700s. Up and taking your money to another country that still likes you is the click of a mouse and a private jet flight out. So no they won’t capitulate to higher taxes of earlier times. They will just leave. Like they already are at the threat of it.

While this proposed California law is unlikely to be Constitutional, there are federal laws that prevent people from simply leaving the country and taking all their money with them to avoid taxes. You can try, and with good lawyers and accountants, you can certainly shelter a lot of it, but in the end you can't avoid tax liability just by leaving. Plenty of uberrich get away with it, but it's still not legal. You can't even completely avoid it by renouncing your citizenship if you're a dual national; there's still a liability.

I know that the uberrich get away with dodging taxes all the time, but there are potentially high costs, like having your assets confiscated, or having to hide out in your island fortress and never return to the US lest you end up in prison.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#136

Post by rorykoehler »

OminousWeapons wrote: post #124
tsimionescu wrote: post #97

Earlier quoted context omitted.

The most important point of taxing the top ~1% is to simply bring their wealth more in line with their contributions, and to reduce their outsized power on the political system. Jeff Bezos isn't "worth" a million times more than his warehouse workers, and he shouldn't have that kind of money either as a matter of principle, or as a matter of democratic power. It's not a matter of punishment, but a matter of ensuring…

I think it's worth asking why compensation is the way it is. If we assume that people's compensation is based on the value they generate for an organization, then what you are asking is basically "can a million warehouse workers together in a collective be as effective as Jeff Bezos at producing value for Amazon?" Alternatively, you could ask "can a given warehouse worker given one million times his current compensat…

This is a false equivalence with the argument GP made. It’s not healthy for society to have Bezos level wealth in one person. It will never be no matter the political system in place.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#137

Post by emteycz »

Pfhreak wrote: post #132
emteycz wrote: post #128

Earlier quoted context omitted.

Exactly. How else would it get to his bank account? If he didn't create it, why people sent it to him? He stole it?

Profits are just unpaid wages. He bought labor for less than it was worth and pocketed the excess.

That means the workers will have absolutely no problem founding their own business and there is no need to tax Bezos.

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#138

Post by throwaway2245 »

syshum wrote: post #92
throwaway2245 wrote: post #32

This proposal is 0.4% tax on wealth above $30m. The Dutch equivalent is 1.6% tax on wealth above €1m. The number of Ultra High Net Worth Individuals in the Netherlands is still increasing.

There is a HUGE difference between the 2 if I understand them correctly CA is imposing a tax on the TOTAL wealth of a person over the limits and excluding real property. The Dutch impose a tax on the increased value of the wealth in the year, even if it was not "realized", which is more like our Capital Gains. So an example, if you had Stocks worth 100 million, and they increased in value to 108 million in 2020 Dutch…

No - the Dutch tax is a fixed amount based on your total holding on January 1st.

Your taxable amount on €100,000,000 is (approximately) 1.6% of the total, not of the gain. You would pay €1,600,000.

This does replace capital gains (I'm not sure to what extent): it is presented as an assumption that you will gain a fixed amount of [edited: 5.28%].

Re: California plan for wealth tax on anyone who spends 60 days a year in the state

#139

Post by purple_ferret »

PragmaticPulp wrote: post #77
caseysoftware wrote: post #26

I'm not sure what the problem is. When Democrat supporters demand more more more via the politicians who promise more more more, where did they think the money would come from? Believe it or not, the bottom ~50% don't have enough money to tax. The next 30-40% have some but not enough to raise enough money to help. The taxes have to be focused on the top 10% and more likely the top 1-3% to raise enough to meet these d…

> where did they think the money would come from? There’s a growing misconception that everything can be paid for by simply taxing the wealthy a tiny bit more. Several prominent activist politicians have built their platforms on the idea that billionaires are an infinite source of consequence-free tax revenue. These ideas are especially popular among the college students and new college grads I mentor. It usually fal…

Elizabeth Warren's wealth tax plan claims it will be bring in 3.75 trillion over 10 years.[1]:

>That’s why we need a tax on wealth. The Ultra-Millionaire Tax taxes the wealth of the richest Americans. It applies only to households with a net worth of $50 million or more—roughly the wealthiest 75,000 households, or the top 0.1%. Households would pay an annual 2% tax on every dollar of net worth above $50 million and a 6% tax on every dollar of net worth above $1 billion. Because wealth is so concentrated, this small tax on roughly 75,000 households will bring in $3.75 trillion in revenue over a ten-year period.

Are you saying this is wrong if I 'pull out my calculator' and run the numbers? The reality is it is not. Wealth is massively concentrated at the top in this country, and from a purely numbers perspective, if it were 'redistributed' it could cover a lot of basic costs that occur in this country.

[1]https://elizabethwarren.com/plans/ultra-millionaire-tax

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