[Manuel_D]

That scheme still wouldn't work. When that new corporation is first formed, it's near worthless. After the series of favorable deals, the value of each share in that corporation goes up. Thus it still incurs capital gains taxes.

Of course people will try to cheat taxes, but they'll try to cheat any form of tax: income, capital gains, inheritance taxes, etc. People are good to try and evade taxes regardless of the tax mechanism.

Consumption taxes are regressive: a sales tax is a flat tax that taxes a billion on their $10 latte the same as a poor person. Consumption also doesn't scale linearly with wealth: most billionaires don't consume 1000x as much as a millionaire.

[AnthonyMouse]

> After the series of favorable deals, the value of each share in that corporation goes up. Thus it still incurs capital gains taxes.

Only if you sell the shares, which they easily resolve by not doing.

> People are good to try and evade taxes regardless of the tax mechanism.

Which is why you should use the ones that are less susceptible to it rather than the ones that are more susceptible to it. Trying to identify the country in which "profit" is earned in an international supply chain, or value non-fungible assets not undergoing transactions, are easy to game. "You pay a given percentage when you buy something" is hard to game.

> Consumption taxes are regressive: a sales tax is a flat tax that taxes a billion on their $10 latte the same as a poor person.

The existing "progressive" income tax and benefits programs do worse than that: The billionaire pays less on $10 in marginal income than a poor person, because the taxes and benefits phase outs result in absurdly high marginal rates on the poor.

> Consumption also doesn't scale linearly with wealth: most billionaires don't consume 1000x as much as a millionaire.

Only if you're looking for it in the wrong place. A billionaire isn't going to buy a billion dollars in lattes, they're going to invest in some business ventures, which in turn are going to spend the money on equipment and vehicles and utilities and so on, i.e. consumption. You don't get a return on capital by sticking it in a mattress, you get a return by spending it to build or operate something.

[Manuel_D]

> The billionaire pays less on $10 in marginal income than a poor person, because the taxes and benefits phase outs result in absurdly high marginal rates on the poor.

This is just patently false. The highest marginal income tax rate is 37%.

If you've read articles claiming that billionaires pay some absurdly low tax rate, those articles are counting their capital gains as income. Which is just a flat out lie, since those gains don't actually get taxed until the gains are realized, and the value of that capital can go down.

[AnthonyMouse]

> This is just patently false. The highest marginal income tax rate is 37%.

Account for benefits phase outs as the tax on marginal income that they are and the marginal tax rate on lower income people is often well in excess of 37%. In some cases it has been in excess of 100% because many of the phase outs overlap and also combine with ordinary taxes.