With various states trying to tax wealth, I’ve decided to take this head on and show why it’s not at all a healthy exercise, and will hurt the wrong people.
- Determining wealth is totally arbitrary. Here’s an example in my own life.
On Black Friday of 2023, I purchased this surround system. I paid like $1,000 for it brand new on Ebay (manufacturer runs an ebay site).
Let’s say you want to tax my sound bar, because you say it’s a luxury I don’t really need (and the poor need the money more than I do). What value will you attach to it? The $1000 I actually paid for it, or the $1900 suggested retail? Or the $1,600 it’s currently selling for on Best Buy?
Stocks and bonds valuating works very similarly in the fact it’s fluctuating all the time. What value do you assign to that? The 52-week high? The price they bought it for via the stock option? The 10-year low? Which value do you assign it?
Anyone want the job of assigning such?
- It hurts the lower classes more than the rich. This should be a no brainer. Let’s use Elon Musk as an example. For the sake of argument, let’s assign his ‘wealth’ at $200 billion.
At a 1% ‘wealth tax’ his tax would be $2 billion. He doesn’t make nearly that much in a given year, so he’s going to have to dump some Tesla stock. In fact, he’s going to have to dump a LOT of Tesla stock to pay this tax.
What do you think that kind of stock dump is going to do to the value of Tesla stock? And that is not just one year, that is every year you asses this tax.
Don’t think that will affect you? Do you own an IRA or 401k? Are you dependent on some kind of public pension fund, or a union pension fund?
It affects ANYONE who owns Tesla stock.
And that is just one person. Multiply that by every millionaire or billionaire living in your state. Even the ones over a certain threshold. That’s a lot of stock dumping, and it’s going to hit everyone HARD.
Do you really want to punch yourself in the face like that?