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

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

#171

Post by granzymes » Sat, Dec 19, 2020, 4:35 PM UTC

rorykoehler wrote: post #112

GhostVII wrote: post #96

Personally I disagree with the whole idea of wealth taxes, you should be taxed when you do things, not taxed just because you own something worth money. I should be able to go live in the woods alone and not have the government take some percent of my net worth just because I exist. I mean I don't have a tonne of sympathy for people with tens of millions of net worth, but it just seems wrong in principle. If I start…

I see it the opposite way around. We should only have a wealth tax and no income taxes. Capitalism means capital that earns for you while you sleep. Those who benefit the most from the system should pay for it. With only a wealth tax more people would have the means to amass wealth and there would be a greater incentive to spend rather than sit on money which would be good for the health and dynamism of the economy.

> Capitalism means capital that earns for you while you sleep.

If it earns for you while you sleep then it is also taxed while you sleep. Income is income: the tax man doesn’t care where it comes from.

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

#172

Post by ericmay » Sat, Dec 19, 2020, 4:35 PM UTC

WillPostForFood wrote: post #157

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…

because of 0.4% If California was well run, clean, and had otherwise lower tax, then .4% might be easy to ignore. But if you’re already on the fence, and not happy with things, and have been talking to real estate agents in Seattle, Austin, Miami, or Singapore, then this just the kick in the butt you might need to go through with leaving.

Singapore is a weird one to throw in there with the others in that list. Could you elaborate?

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

#173

Post by hpoe » Sat, Dec 19, 2020, 4:35 PM UTC

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…

And for those of us that have seen this type of tax play out historically where "it's just 0.4% and just on the top 1%" and want to avoid being dragged down any farther?

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

#174

Post by xiphias2 » Sat, Dec 19, 2020, 4:35 PM UTC

belltaco wrote: post #61

Title should be 'anyone with over $30m of non-real estate weath', not just 'anyone'. It's highly misleading to basically say everyone.

It should be just the opposite: real estate is the limited resource that all people in California need to share, not the revenue of a multi-national company concentrated in 1 state.

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

#175

Post by whatthesmack » Sat, Dec 19, 2020, 4:36 PM UTC

rorykoehler wrote: post #136

OminousWeapons wrote: post #124

Earlier quoted context omitted.

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.

It isn't a false equivalence, though.

From the original comment:

> taxing the top ~1% is to simply bring their wealth more in line with their contributions

The comment above yours is just pointing out that Bezos may contribute more, which would be an explanation for Bezos' outsize wealth. Whether it's true or not that Bezos contributes more is subjective, of course.

> It’s not healthy for society to have Bezos level wealth in one person.

That's an entirely different point unrelated to the "contribution" question/attribute.

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

#176

Post by beezle » Sat, Dec 19, 2020, 4:36 PM UTC

notacoward wrote: post #33

eloff wrote: post #11

Earlier quoted context omitted.

In America in general it's about 40% [1]. When put that way, California taxes seem about right as they are. [1] http://papers.nber.org/tmp/7707-w24085.pdf

This point needs to be hammered home every time the rich (or their "hope to be rich" enablers) talk about what percentage of total revenue they pay. It's almost as if they think a poll tax would be fairest. They pay a higher dollar amount because they have more of what is being taxed, which in turn is largely because of a system that actively drives "rich get richer" disparities. You have to look at the rates not the…

The issue is the 'progressive' nature of the tax code. Everyone could be taxed at the same rate and the 'rich' would still pay the most in tax dollars. The only reason ever given for why the 'rich' should pay a higher tax rate is 'because they can afford to.' Which then leads to tax code legislative loopholes to try to offset the excess taxation and then more resentment when those loopholes are used to shelter income.

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

#177

Post by api » Sat, Dec 19, 2020, 4:36 PM UTC

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…

If California were well run, sure. Do something about the housing and homeless crisis and we’ll talk.

California doesn’t have a money problem. They have a lack of political will problem and an incompetence (or corruption) problem. The state is held hostage by NIMBYs and is chronically unable to build infrastructure. Look at the high speed train disaster for an example of the latter.

NIMBYs ensure that any money or effort put into the homeless problem is also wasted, as there is no affordable housing for these people to inhabit even if their mental health issues are dealt with.

More money won’t fix these things. It will probably go into the pockets of the people who created these problems.

Note that much of what I wrote applies to the USA broadly. We are taxed not much less than Canadians, but have the infrastructure and social services of a “developing” nation.

Give me either low taxes at e.g. Costa Rica levels OR shiny infrastructure, free college for my kids, and universal healthcare.

Oh wait Costa Rica has universal health care...

We are great at setting money on fire in this country.

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

#178

Post by bouk » Sat, Dec 19, 2020, 4:36 PM UTC

throwaway2245 wrote: post #138

syshum wrote: post #92

Earlier quoted context omitted.

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%].

There are no capital gains for personal holdings in the NL. So as long as your year over year gains are higher than 4% you're ahead. For example if you double your money with Bitcoin you still pay 1.6%

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

#179

Post by Acrobatic_Road » Sat, Dec 19, 2020, 4:36 PM UTC

purple_ferret wrote: post #139

PragmaticPulp wrote: post #77

Earlier quoted context omitted.

> 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…

Wealth is not money.

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

#180

Post by curiousllama » Sat, Dec 19, 2020, 4:36 PM UTC

GhostVII wrote: post #96

Personally I disagree with the whole idea of wealth taxes, you should be taxed when you do things, not taxed just because you own something worth money. I should be able to go live in the woods alone and not have the government take some percent of my net worth just because I exist. I mean I don't have a tonne of sympathy for people with tens of millions of net worth, but it just seems wrong in principle. If I start…

> why should the government be allowed to force me to sell my company

If it’s your company, is there any particular reason you don’t pay it (or a loan against your equity) out of cash flow? Just like every other significant expense?

If it’s a painting or a car, it’s already getting taxed as an inheritance, so this is just a .4% increase in a 40% tax, no?

I happen to agree that wealth taxes are unwise, but it’s not because implementation is weird. We already have property taxes; we’ll figure it out.

The main reason it’s bad is because wealth taxes compound, even when you take losses on investments. Retirement accounts will simply be ~20% smaller than without the tax.