[IMTDb]

You are mixing his income with the increase in his net worth. Those are not the same thing. The $175 millions are the increase of the value of his stocks. Until he sells those stocks, he earns a total of $0.

You can't really tax "increase in net worth", because net worth can - and does fluctuate both positively and negatively, As opposed to income which just accumulate more or less linearly.

Imagine Jeff Bezos stock has a perfect seasonal effect: on odds years, he gains $1 billion and on even years, he loses that amount. We can all agree here that Jeff sin't getting any richer, on average and thus should not be taxed since he is not getting any stable income. Yet you would want to tax him, every odd year, on the $1 billion - which is unfair, unless you also give him back that tax money every even year. This means firing those workers and asking them to give back their undue wage - which you can't do of course.

The way we solve this is by not taxing the increase in net worth, until he does actually sell the stock and converts this increase in stock value into what is called realized gains. At that point, his net worth won't fluctuate anymore since he sold the stock for cold hard cash. And we tax him on that cash amount. You might argue that we should tax him more on those realized gains - which is fair discussion point.

But trying to impose a tax on virtual net worth increase is a quite risky path because you would also need to pay billionaires when their stock portfolio decreases. And although everyone wants to tax billionaire when you hear about them having a fantastic month on the stock market (even tho these gains haven't been realized yet), but no one want to send them money when a headline says "$25 billion wiped out in a single day" (and rightfully so).

[dr_dshiv]

In the Netherlands, there is a small wealth tax. It fluctuates based on net value of holdings. Pretty straightforward, actually.

Personally, I wish the income tax for high earners could be deferred for the first year or two. It’s like, right when you are first building wealth, it goes away so fast… but then, once you got wealth, why not plan to pay a percent or two a year in tax?