[leugim]

This is a shortcut for taxing unrealized gains.

They start with NW >100 million and start decreasing the concept of Ultra-Rich until everyone non-broke eventually pays it.

In Spain it happened with the Work Tax which from >60k EUR (68k USD) goes to 45% as if earning 3k EUR (3.4k USD) per month made you rich.

[JimBlackwood]

There’s a long way between NW >100 million and making 60K EUR.

Maybe if they taxed NW >100 million, you wouldn’t need a 50% tax on work.

[arjie]

The proposal does not involve reducing existing taxes. It is a technique to pay for increased spending. So the latter sentence seems unlikely.

[xienze]

> Maybe if they taxed NW >100 million, you wouldn’t need a 50% tax on work.

Don't be mistaken, it's an "in addition to" tax, not "instead of", or else it wouldn't be pitched as one of many ways to plug a budget hole.

[bigbadfeline]

Any "addition to tax" should still be a tax.

[ezst]

Let them start somewhere. Inequality has only accelerated in the past decades, undoing the fabric of the fair and democratic society which many/most people perceive as a condition for long-term stability. If taxing wealth isn't it, then what else do you propose? We seem to agree that taxing income stinks while news like "50 richest families own 50% of the country" abound. Those didn't get there by working a job or being clever/lucky about betting their pension money on some ETF. Only extraordinary measures will make a dent on this extraordinary accumulation.

[mnky9800n]

I pay a progressive 47% in Norway. I am sick of having half my salary taken over ~600kkr (60k usd). It’s ridiculous. Plus 25% VAT on everything. And it’s not like salaries are through the roof. Why bother paying me a salary at all at this point? Just let the state give me everything if they are going to take it anyways.

[spwa4]

Well currently about 3 working people are paying 1 pension. So that's where 33% of your taxes are going to. By 2050 that will be about 1.8. So that 33% will have to become 55% JUST to maintain current state expenditures. And it will keep dropping.

Which would make your 47% tax a 70% tax (minimum) in the current funding model. And that's assuming no rise in unemployment or anything like that.

That's actually pretty good compared to northwest Europe. I mean Norway has about 1500 euro per person per month in "free" taxes (from oil sales), which will also disappear, probably sooner than 2050. So add that, I guess.

Looking at those numbers, of course, one can easily see that the current financial structure of states will just not support that level of state expenditure (and it's a labor problem, not a money problem). So that is not what will happen because it simply can't.

[bryanlarsen]

A marginal tax rate of 45% above USD68K seems unsurprising for any developed country with public health care. Presumably the realized rate at EUR60K is a lot lower than 45% and 45% is only the marginal rate.

American tax numbers are only a little lower, but do not include health care. An American employer is likely paying around $8K for a single person or $20K for somebody with a family. That's a real and very heavy tax that Americans pay.

[mc32]

As long as there are reasonable countries they can move to and moving doesn’t impact their business enough, people will move to more favorable tax environments even if they have qualms about the new options politics if taxes get too high. A few years ago France imposed larger taxes and a few wealthy people left and some even took debatable citizenship options.

Some people may not like this to happen but it does and would.

[thepryz]

I think most people are quickly coming to the conclusion that maybe the wealthy aren't as critical to a community as they would like everyone to believe.

The big argument around NYC's pied-à-terre tax among other policy changes was that it would force the wealthy to relocate outside of NYC to more favorable locations. That hasn't happened, and for a place like NYC, very unlikely to happen because people are attracted to the city for what it provides. Worst case, they leave, the property values decline and the city becomes more affordable with any gaps in businesses likely filled by those living and invested in the community.

[mc32]

It depends it may have an analogue in the evaporative cooling effect in the tax and investment base.

If the state goes too far, those with wealth may take their wealth and invest in in friendlier investment climates where their home country suffers from wealth drain and potentially could end up as country versions of Detroit (or maybe like VZ where as the state confiscated property investment dried up).

[spwa4]

The problem is that these taxes, like every other tax, will soon apply to the middle class (who have the real wealth), and they very much will leave. Either physically leave, or they will leave like they do in a lot of European countries: find some excuse to first become long-term ill, then go onto unemployment. And obviously the state cannot stop this. You want to do this? There's nothing the state can do about it (other than seriously lower pensions, unemployment and medical insurance)

There are articles about UK families that have been doing this for 5 generations. The entire family.

The problem is not money. There are far less working-age people, and it'll keep dropping for 25 years minimum. Which means the only solution is people working more, for someone else. A little bit more every year, for now without any visible end. Either that will happen, or the state (including elderly care) will have to shrink instead.

Pick your poison. And, of course, every electorate is saying "NONE OF THE ABOVE". Okay ...

[lifestyleguru]

60k is now worth somewhere around 49k in pre-Covid Spanish Euro. The highest income tax rate on employment contract is brutal. Why would anyone work there at all? No wonder I meet young Spanish anywhere I go, and they are not tourists. Then Europeans moving to Spain are not moving there to work either.

[ninininino]

> In Spain it happened with the Work Tax which from >60k EUR (68k USD) goes to 45% as if earning 3k EUR (3.4k USD) per month made you rich.

Sounds worse than it is since it's progressive taxation meaning the effective tax rate for the entire 60k EUR is somewhere like ~29%, not 45.

€0 to €12,450: 19%

€12,451 to €20,200: 24%

€20,201 to €35,200: 30%

€35,201 to €60,000: 37%

Source: Gemini so it could be complete bullshit.

To be fair, VAT is heaver in Europe than for example US, so the overall tax burden might still feel more onerous.

[leugim]

It's progressive so the first 10k are not taxed as the last 10k. I do not deny, the problem is that 60k is the highest bracket* so >60k you are considered rich.

In Spain if you earn more than 60k you are considered rich.

* There's one of 300k at 47% but even that one does not change so much as the <60k to >60k.

[yokaze]

> In Spain if you earn more than 60k you are considered rich.

No, you are high earner. It puts you squarely in the top 10%.

[spwa4]

60k euro per year in a city like Barcelona or Madrid does not make you wealthy. Not remotely. And in the other cities rent might be better, but jobs are a lot harder to find too.

60k euro gives you 33k after tax (2800 euro per month), and everything you do with that is taxed at minimum another 25% (that's the VAT)

[yokaze]

The numbers are simply wrong. The VAT is 21% tops and in the highest taxed region the 60K are effectively taxed at 32%.

And you miss the point that wealth is not determined by how much you earn, but how much you have.

Various super rich are nominally earning one dollar/euro.

I know doctors that have trouble finding a flat and others that complain about being classified as big renter because they only have six flats. The discriminator is not the income. (When we talk about the Ultra-Rich).

[spwa4]

> And you miss the point that wealth is not determined by how much you earn, but how much you have.

That IS my point. Earning is how you become wealthy. That is heavily taxed, because it's easy for the government to do. These taxes prevent anyone becoming wealthy.

They are, however, protecting people that already are wealthy. Cross the threshold where you make more from owning stuff than from income and Spanish taxes look a whole lot better, because you can determine yourself how much income you have. In other words: you only pay tax on the income you actually use for living. Any income used for wealth-building is not taxed (acquiring the actual assets still is but 20% in the worst case. Also investment gains are not taxed, if you structure things right). Cross the next threshold: where you wealth not only pays for living but actually lets you acquire more assets and it's even better. For that ("reinvestment") you pay ZERO percent taxes on the money used to grow your assets.

The very wealthy get richer in Spain. You just can never join them.

[mono442]

shouldn't it be 5k per month?

[leugim]

No 60k EUR is gross, which nets around 3k EUR month + 2 extras (Summer and Christmas). Or 3.4k EUR month without extras.