this post was submitted on 05 Jun 2024
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A billionaire would potentially turn into a multi hundred millionaire. Very unlikely they would lose ~99% of their wealth to "only" become a millionaire.
The difference between a million dollars and a billion dollars is about a billion dollars.
Great but that doesn't change my point. Securities fluctuate, if you don't sell then how do you value them?
And why shouldn't they be forced to sell?
If there's a huge tax penalty to hording company shares, maybe, just maybe, they would be instead incentivised to profit share with their employees. To focus more on retention than to do waves of layoffs to give their massive holdings a bump.
But we can't have that. We need to incentivize narcissistic mega billionaires to have all the money in the world, and still clutch to every last penny while they work their peasants to death.
Great. But how do you value them. A stock that's worth $5 one day, $10 the next, and $3 the next. How much do you tax it? How often?
You're giving high minded speeches and stuff but I'm asking how it would practically work. Because I think it's way more complicated than you think it is.
Edit: See further down, it could be done by averaging amounts over time.
High minded speeches? Seriously? There are plenty of feasible options.
If it's a public company, you can take the median price for the quarter. If they're holding over $500,000 or whatever amount as calculated by the median share price, they're taxed. You can make it tiered, and tax the shit out of anyone holding over $500m or whatever. If they want to avoid that tax, they can sell, and pay the capital gain.
Or they could tie it to % over median employee shares granted per year. So if you have lopsided profit sharing, tax the fuck out of the greedy C level.
Private is harder since it's less obvious what the tangible value is. But you could use the % shares granted yearly again. Maybe have it tiered to a companies net worth or whatever other metric that would be most appropriate.
It's fucking ridiculous that we have articles like "Bezos lost $1 billion after shares took a dive this week" kind of articles. That's a single person hording billions and billions in shares while the workers doing the actual work get pennies.
Most stocks are in mutual funds and ETFs. So if I have a million dollars, but I only own like $500 worth of any one company...?
... is that seriously what you're talking about? You can't imagine being able to estimate the worth of traditional investments? That's already implemented.
You already pay capital gains on what you earn in a year. It would be very easy to factor those investments into a wealth tax. Like... trivial.
Explain then. Would you have to calculate your equivalent net worth throughout the year and pay monthly taxes on it?
I'm not saying it's impossible, I'm saying it's very difficult.
Yearly would be fine, but it could be done quarterly to. The capital gains tax on stock profits is already done quarterly.
You know what, I've thought about it some more and you have a point. Securities valuation could be averaged out over a period of time and then treated as cash reserves for taxation purposes. That's actually not as difficult as I thought it might be. Minor additional burden on investment firms.