Wealth Taxes, is Taxation of Capital a Trend?

Taxation on wealth has become a predominant presidential campaign platform in some countries. 

Argentina, Chile, Bolivia enacted or have proposals for levies on millionaires, taxing their assets rather than their income. Argentina now has a one-time wealth tax, Bolivia an annual levy. Brazil, Chile, and Peru are pushing for similar measures. 

Many European countries do impose annual taxes on capital. 

In the U.K., a detailed Resolution Foundation briefing titled "The U.K.’s Wealth Distribution and Characteristics of High-Wealth Households,” published January 3, was presented in evidence to the U.K. Wealth Tax  Commission.

In a December 2020 report, the Commission concluded that a well-designed wealth tax would raise significant revenue in “a fair and efficient” manner and would be difficult to avoid. 

More than 45% of a 2,000 readers’ poll support the tax increase on assets and second homes as a way to help the economy recover, The Sunday Times reported January 3, “as long as it did not include the value of their main home.”  

Two-thirds of readers who supported the tax believe that “the gap between rich and poor had become too great during the pandemic, and that a new levy was the best way to improve income equality.”

The United States does not impose a federal tax on capital and may not do so constitutionally. However, some U.S states are pushing forward on the state level. 

In a hardship COVID-time, governments are looking for any possible way to increase revenue; the rich is an option. The COVID costs were not budget by any Government. The budget crisis is a fact.

Critics consider that higher taxes on the wealthy threaten to push away affluent residents.

The capital will always seek and flow to countries that offer more significant benefits, including tax incentives. 

4C-4C:18 Lexis Tax Advisor -- Federal Topical § 4C:18.02 (2019)

2021 TNTI 6-2