[heavyset_go]

Weird that you think incomes that can approach effective tax rates of ~50% are the problem and not the capital gains that are taxed at 15% to 20%.

If you are wealthy you don't need an income that's taxed a high rate for the plebs, when your wealth is generated by capital gains. Surely you knew this.

Also, your hypothetical is a bit weird. The point of investments isn't to liquidate them immediately, but to reap returns. Owners of significant assets tend to borrow against them instead of liquidating them.

[noyoudumbdolt]

Like I said, I'm including capital gains income in my figures. I'm not sure what point you're trying to make in your first sentence. Capital gains are taxed lower because, in theory, that income was already taxed at the corporate tax level, since capital gains come out of corporate profits. Wages, on the other hand, are a corporate expense, so they're exempt from the corporate tax. This whole thing is somewhat broken by the corporate tax being easily avoided for large corporations. But anyway, this whole thing is an aside and irrelevant.

Look here https://en.m.wikipedia.org/wiki/Income_inequality_in_the_Uni... . The Top 1% is the small bright pink part of the furthest right bar. You can raid them at 50% tax every year if you'd like, but that's not going to make a big difference.

[zozbot234]

Capital gains are created by investing income that has already been taxed. Any tax on capital gains, at least in principle, is double taxation. (This doesn't mean that the optimal tax on capital gains should be zero because in practice, lots of capital gains correlates with lots of competence at generating earned income - so, in a way, that double taxation can be seen as earned-income taxation in disguise. It does mean that there's plenty of reason not to treat them the same.)