We have a pretty strong reliance on the estate tax for situations like these. I imagine if longevity were discovered, that would change to another kind of wealth tax within 10 years.
Does the estate tax actually work in the US? Our equivalent in Britain appears to be a joke - anyone with a reasonable amount of money can just hire accountants to find some trivial way around it.
I think it's probably the most important tax, in terms of social equity - if you can easily pass down all your wealth from one generation to another, there are no wealth taxes, and capital reliably grows faster than the general economy, that is an obvious formula for the creation of an aristocracy - but I don't know whether it's compatible with the global financial system. Or perhaps it's just British politicians are particularly lackluster on cracking down on obvious avoidance schemes.
Not really. Estate taxes on large inheritances represent a tiny fraction of the overall federal tax revenue.
There are many techniques for circumventing/minimizing the tax. Law firms and accountants whose sole purpose it is to legally minimize this tax exist in every major American city.
The rich are making huge amounts of money compared to the rest of us now, and paying little taxes. What makes you think that longevity would change that?
People make this mistake all the time. The rich are paying the vast majority of all taxes paid, whether by income or property purchases. What isn't taxed is accumulated wealth and it should not be. The US has one of the most progressive systems in the world, one that harms competitiveness of businesses as well.
The simplest solution is to move from income to taxing spending. We have had the technology for tens of years where we can send people assistance, pension, and medical payments. Hence the technology to refund a percentage below the tax threshold exists.
I am loathe to use the name Fair Tax as it has been demonized by many, but note the bulk of this resistance is through political parties sponsoring groups and "think tanks" to do so. The reason is simple, a single flat/fair/etc tax on all purchases and service buys removes a lot of power from government. It would not be easy to switch too but in the long term it would remove the biggest burden to the countries economy which is the whimsy of those in charge.
Estate taxes are just evil. You got me when I earned it, how dare you take it from family just because you decide it was no longer ours once one person dies. Hence a consumption tax replacing all these taxes would be far better.
> People make this mistake all the time. The rich are paying the vast majority of all taxes paid, whether by income or property purchases.
This is true, but when you compare the percentages of the taxes that they pay to the percentage of the income that they enjoy, you'll find that they are paying a smaller percentage of the taxes than they are enjoying the benefits of income. And that's reported income: there are plenty of legal loopholes that allow the rich to legally avoid reporting large portions of their income.
> What isn't taxed is accumulated wealth and it should not be.
I agree with this, but this is used as an excuse for not taxing investments as highly--which doesn't make sense. Income is income is income--it shouldn't matter if that income comes from work or capital gains.
> The US has one of the most progressive systems in the world, one that harms competitiveness of businesses as well.
The US is one of the least progressive systems in the developed world. Sure, we're more progressive than Somalia, but that's to be expected.
> The simplest solution is to move from income to taxing spending.
The richest spend the smallest percentage of their income and therefore would be taxed the least percentage. I'm not sure what mental gymnastics you're doing to make this make sense in your head but it doesn't make sense anywhere else.
Also, income tax doesn't dis-incentivize anything: there will always be an incentive to make more money. But a spending tax would dis-incentivize spending--which would be terrible for the economy. For someone who earlier was complaining that our tax system hurts the competitiveness of business, I'm not sure what makes you think a tax system that encourages dragon-like hoarding of wealth would hurt the competitiveness of business: it would, if anything, mean that people simply avoid doing business at all.
> We have had the technology for tens of years where we can send people assistance, pension, and medical payments. Hence the technology to refund a percentage below the tax threshold exists.
Okay, this could work, but why would we tax people just to refund them?
> The reason is simple, a single flat/fair/etc tax on all purchases and service buys removes a lot of power from government.
That's true, but it moves that power squarely into the hands of large corporations that are even less answerable to the people who their actions affect. I don't like governments any more than the next person, but I do like them more than giant corporations whose only morality is greed. At least a democratic republic has incentives to appear somewhat moral some of the time. Corporations have no such incentive.
> You got me when I earned it, how dare you take it from family just because you decide it was no longer ours once one person dies.
Ah yes, it's really important that we keep the wealth in the hands of a few people who were born into it. We wouldn't want to incentivize work, innovation, or progress, now would we!
