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Patrick
2011 Nov 2, 6:01am
Not net assets. ALL assets.
So if you borrow to buy a house, you still do pay the 2% on the house each year.
SFace
2011 Nov 2, 6:38am
A 2% tax on all assets is simple and fair, and pretty easy to verify for large assets (real estate, stock, bonds). Why not do it?
First off, If I am a retiree and spent my life working and accumulated wealth, which was subject to income tax already on that path and now you're going to clobber me again with an asset tax now that I'm done earning income?
Financial assets are pretty liquid and I'm sure they would be taken elsewhere around the world and that 200T in assets as claimed will shrink to 100T easily.
Patrick
2011 Nov 2, 6:55am
A 2% asset tax is hardly "clobbering" anyone.
Especially since you'd pay 0% income tax, and 0% sales tax. And 0% inheritance tax.
No capital gains tax either. No dividend tax.
Seriously, you could come out ahead, even in retirement.
Patrick
2011 Nov 2, 6:59am
Financial assets are pretty liquid and I'm sure they would be taken elsewhere around the world and that 200T in assets as claimed will shrink to 100T easily.
Nope, not going to happen. First of all, most of those assets are not mobile (think land, factories, office buildings) and second of all, the US economy would probably boom with zero income taxes and zero sales taxes. And an incentive to spend.
Anyway, you'd owe the tax as a US citizen even if you moved assets abroad. Unless you give up citizenship and leave. Which is fine. You could do that now anyway.
so say someone makes 100k, doesn't own a car or a home, could end up paying no taxes?
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If the total value of all US assets is about $200 trillion, and the total tax revenue in the US (federal, state, and local combined) is about $4 trillion per year, then it follows that a simple tax of 2% on all US assets would pay all taxes.
So we could eliminate the income tax, the sales tax, the inheritance tax, and the current property tax.
Here's one estimate of all US assets at $188 trillion:
http://rutledgecapital.com/2009/05/24/total-assets-of-the-us-economy-188-trillion-134xgdp/
Here's US federal tax revenue at $2.7 trillion:
http://en.wikipedia.org/wiki/Federal_tax_revenue_by_state
A 2% tax on all assets is simple and fair, and pretty easy to verify for large assets (real estate, stock, bonds). Why not do it?
#housing