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Comment by andrepd

18 days ago

It's not a revolutionary idea. That I know of, the Netherlands does it, somewhat. How it works is: rather than taxing capital gains, with its myriad loopholes and counterloopholes, you tax assets directly: assume a neutral sort of "risk-free" rate of return, and then tax a percentage of that. E.g. assume yearly return of 1% on cash and savings, 6% on other assets, etc, then levy tax of 30% on that (past a tax-free allowance of 25k€ per person).

Simple, and more effective!

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andrepd

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ml-anon  17 days ago

Americans become idiots when it comes to tax, unable to understand even the simplest concepts or fathom that things might have been possibly implemented elsewhere.

Hell even Switzerland taxes global assets. You just declare your stocks, property, etc at some instantaneous value and that’s that. Capital gains aren’t taxed.

The system is easy to cheat and until recently it was possible for HNW people to get a bespoke deal when moving there. But the tax rate is low enough and the risk is high enough that it’s more beneficial to just pay.

shivasaxena  18 days ago

I would consider it very destabilizing idea and an affront to fairness really.

As an example, Wouldn't that mean that if my startup raises a round of 1m for 10%, my NW would go to 0 to 9m. 6% of that would be around 0.5m, and 30% tax would mean I would have to pay 162,000 EUR in taxes.

As a cash poor founder how do you suggest I pay that.

That's why taxing income and not wealth has been the norm.

  • andrepd  17 days ago

    Have you considered taking a measly 20 seconds out of your day—surely a fraction of the time you took to type this comment—to google this information?

    Another point: have you considered that the authorities and people of the Netherlands, a very rich country with several valuable companies, may have possibly thought of this absolutely trivial argument when designing their tax code? Do you really think nobody thought of it?

    Jesus

    ---

    To your point: stakes in your _own_ company are not taxed as assets, but as income, precisely to avoid the ridiculous situation you point out.

    Simply put: your retirement savings, your brokerage account = assets, your startup, your company, your farm = income.

    • shivasaxena  17 days ago

      > To your point: stakes in your _own_ company are not taxed as assets, but as income, precisely to avoid the ridiculous situation you point out.

      Enlightening, so you mean this policy isn't for the so called "1%"? Only for middle class folks and their stock portfolios? That's not what the GP was proposing.

      > Another point: have you considered that the authorities and people of the Netherlands, a very rich country with several valuable companies, may have possibly thought of this absolutely trivial argument when designing their tax code? Do you really think nobody thought of it?

      Yes, because I can point to an even richer country, with even more valuable companies where the left proposed same destructive policy only a few months ago and almost came close to winning.

      Lastly, you did make me look it up and it seems Netherlands and other European countries really didn't think it through.

      https://www.leideninternationalcentre.nl/get-advice/blogs/su...

      https://www.linkedin.com/posts/jasoncalacanis_norways-wealth...

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