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by robryan 1835 days ago
There may be unintended consequences in forcing successful founders to over time sell down a controlling stake in their company.
2 comments

Why would they need to sell anything? Just take a salary large enough to cover the wealth taxes. A CEO with a $100M net worth should easily be able to command a salary greater than $1M.
This is like saying that homeowners are being forced to sell their homes over time to pay for property tax.
Some are. We live in an area where annual taxes are about 2% the value of the home. Home values have been skyrocketing and taxes along with them. Some people on fixed incomes can't afford it so are forced to sell. I think property tax should be abolished in general, but the problem with taxing ownership of a company is that owners are then forced to spend that much less on expenses to cover their tax burden (fewer jobs, or lower salaries for employees).

A lot of companies operate close to break-even or even at a loss. What happens with the owner of a $2m / year company must come up with a 10% wealth tax amounting to $200k, but the company is operating at break-even? Expenses must be cut to pay the tax. Ultimately hurts the lower and middle class the most.