[kjksf]

If what he wrote about Dutch taxation, this tax is a replacement for income / capital gains tax, not an addition (and so far none of the "tax the rich" schemes that I saw included removing income or capital gains tax).

At 1.7% a year it gives you quite a few years before it would even reach the same level of taxation as income / capital gains tax.

To make it concrete: last year I made $200k in short term capital gains in stock market. It was taxed at my high marginal tax rate of 35%+, that I had to pay this year.

In Dutch system I would be much better off: I would pay 1.7% on that increase this year and continue paying 1.7% for 20 years before that would equal the amount I paid this year.

And if I managed to, say, 4-8x that $200k in 20 years (at 15% you double the money in 5 years, at 7.5% you double in 10 years, which is a return on S&P index fund), I would be even better off in Dutch system.

So US system, at least regarding stock (which is how all those billionaires in ProPublica article created their wealth) is better only if you hold your stock for 10-20 years, which is generally regarded as a good thing. It both provides stability for stock price and shows the confidence of a person in the business.

[md_]

Few points:

- Yes, I don't know exhaustively, but a number of countries with wealth taxes do not have gains taxes.

- Your comparison is a little bit mistaken, I think; you're looking at the tax only on the gain, whereas (obviously) the tax would be on the entire principle. I'm too lazy to do the math, but a wealth tax is easy to factor in, since it's a fixed reduction in total yield on wealth. The long-term historical return on capital in the west is about 4%/year; a 1% wealth tax is thus averaging about 25% of that. Gains taxes are typically lower than that amount. (Note that in the US the long-term gains tax is 20% at the upper bracket.)