France plots tax on super-rich to rearm – and Britain could be next
telegraph.co.uk
telegraph.co.uk
The estimated evasion _in_the_EU_ using these off-shoring vehicles in Panama is around 100 to 200 billion. [0]
The 2023 Defense spending of the entire EU member states was about 270 billion.
What will happen is income taxes will increase for high earners who cannot evade income tax. And the 'super' rich will continue to own nothing on paper.
[0] https://www.europarl.europa.eu/cmsdata/116947/20170412_panam...
i.e., those pesky jumped-up merchants who think that $1M a year in wages entitles them to speak to us.
And who, despite what seems like limitless wealth to the lower middle class (I would know), don't have nearly enough to really influence on a major scale.
What exactly is the argument made by all these alarmist "who will think of the the wealthy"? Tax the rich and many leave, so you don't get as much tax revenue. Don't tax the rich and you just don't get the revenue. The implication in all these seems to be "well then why not just lower taxes so then the wealthy will grace us with their presence?"
Um, because they're not paying their fair share, and the few who leave don't lead to a net loss in tax revenue/economic prosperity, that's why.
Everything in that article seems quite twisted in its presentation. Quotes like the following:
> Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.
The implication in that quote is "$2.6 gained but $125 lost, wow what a bad tax scheme", which is horribly irresponsible presentation. That's $2.6B/year in increased yearly tax revenues, but a loss of $125B/8 years (1998-2006) in capital, e.g. assets of some kind in the country. In most real-world cases where most of that flight happened early in those 8 years and the year-over-year capital flight goes down as folks acclimate to a tax regime, that's a totally acceptable trade off! In fact, that trade off might be a HUGE boon to France in the near term, let alone the long term. To actually know though, we need tons more information, information that isn't presented at all.
In short, bad article quotes rich guys who don't want to pay taxes saying "our life is so hard now that we've left a country that we liked but not enough to pay taxes on our insanely valuable assets, and that's actually hurting you more than us, so you should totally lower the tax rates on us."
Asymmetric warfare is only going to get easier for the underdog with the advent of cheap drones.
What failed was remaking Afghanistan into a modern democracy. Money and patience ran out.
But militarily, it was a total victory.
It might be a military success by some sort of conventional military definition. But it was a complete failure and utter waste by pretty much every other measure.
It takes decades to subjugate the local population by the invading force and some local resistance will remain for a long, long time.
If victory means "we are now bogged down in some decades-long occupation against guerrillas that drains resources and has no meaningful benefit".
This is objectively false. Eventually, occupation became politically hard to motivate for an American public that was tired of war. But to claim the Taliban beat the US military is ridiculous. FWIW I was there.
- Before the war the Taliban controlled Afghanistan. - The US (+ Allies) invaded and conquered the country. - 20 years later the US Military has left the county. - The Taliban now controls the country again. - At no point during that 20 years was the Taliban actually "defeated" like claimed.
Whether you like it or not "Money and patience ran out" = losing the war.
There are many other "lost wars" where they were lost for the same reason. The most obvious one in this context being the Vietnam war.... which is also a popular one for people to argue that the US Military didn't lose either.
Is this not the case?
And furthermore to my original point do you think that the ubiquity of cheap drones on the battlefield in 2025 would make similar attempts to conquer Afghanistan by the US easier or more difficult if the US were to try the same again?
That the subsequent occupation ended with the Talibans return to power has nothing to do with the war itself but has political reasons. In my opinion, the occupation could have ended completely different with a longer commitment. Unfortunately, the Iraq invasion happened and the American population had little long term interest in nation building, two nations at once.
FWIW Iraq and Afghanistan are very different places.
But this has nothing to do with the military campaign itself. When I was there and where I was(2010, northern Afghanistan), it was a fairly peaceful place. Things were progressing in the right direction.
Regarding your second question, I don't think that the Taliban would have great use of drones considering that we could use essentially the same counter measures we used against remotely operated IEDs(jamming).
Ukraine does not have access to the same equipment we did in Afghanistan.
EDIT:
This article pretty much reflects my views on what went wrong. The US government half assed the occupation and withdrew too early.
https://www.rollingstone.com/politics/politics-news/the-runa...
Could you imagine a different set of circumstances where the year is 1950 and Adolf Hitler is still Fuhrer of the Third Reich and someone is arguing that America won WW2?
America lost in Vietnam, they lost in Iraq, and they lost in Afghanistan. The sooner you come to realize this and that your time spent in Afghanistan was a waste the sooner you'll have a more accurate worldview and can make better decisions than to sign up for what was at that point an obviously pointless war.
> I don't think that the Taliban would have great use of drones considering that we could use essentially the same counter measures we used against remotely operated IEDs(jamming).
Doesn't seem to be working out for either side in Ukraine.
I’ve said what I had to say, have a nice day.
This absolutely did happen and their long fought victory has saddled the US with an tremendous monetary debt and social debt in the form of a fractured American society the consequences of which are an increasingly authoritarian America that is brutishly lashing out at their allies in that conflict.
America's loss in that conflict has cost America far more than we can imagine right now and the cost is only increasing by the day.
Yes, it is.
> and there was no surrender.
Yes, Trump’s release of Taliban priosners and subsequent surrender of Afghanistan to them was a surrender.
> The commander in chief made primarily a political decision
Yes, the decision to abandon a war is always a political decision. It is, in fact, the political decision that every act in war is directed at getting the enemy to make.
There's this weird and frankly dolschtosslegende-ish trend in America post-Vietnam to characterize American victories in war as military and American losses as “political” as if the two were orthogonal categories, but the only military victory is achieving the desired political end, and if you feel like you were “winning militarily” and didn’t do that, then you just didn’t understand the context of the war and your sense of victory was misplaced.
No, it isn't. Wow, that was easy!
> Yes, Trump’s release of Taliban priosners and subsequent surrender of Afghanistan to them was a surrender.
No, it was a retreat. For it to be a surrender, the Taliban would have had to be in a position of power. They were not.
> Yes, the decision to abandon a war is always a political decision.
Except for the times it is solely a military position.
They control the territory. The Taliban is in fact in a position of power. Doubly so now that it forced the US to retreat.
It is a weird definition of "victory", when the end of the war was a hasty and poorly executed retreat.
Only after a voluntary retreat, so that is irrelevant since they didn't have power at the time of the treat, and were not a factor in the decision to retreat.
> It is a weird definition of "victory", when the end of the war was a hasty and poorly executed retreat.
Of course it was a victory. The Taliban were ousted within weeks and then the place was under US control for 20 years. If it wasn't a victory, the last 20 years would have been like the last year instead of what they were like.
A voluntary retreat is not a victory. You are arguing it is, which is extremely odd.
> Of course it was a victory. The Taliban were ousted within weeks and then the place was under US control for 20 years.
If the victory conditions were to be bogged down for 20 years wasting resources in an occupation that netted no benefits, only to have your enemy be back in the following day when you do your voluntary retreat, those are the most retarded victory conditions ever spelled out.
It would be like claiming victory against the Nazis if after some years both the US and USSR left Germany, and in the following day the Nazis were setting up concentration camps again.
If I come in to your country, invade it, and have complete dominion for 20 years, than I've successfully invaded your country. Victoriously.
If I then change my mind and decide to leave, after 20 years of having a provisional government because I got bored, then yeah, my victory still stands, and the rest is details and semantics.
> It would be like claiming victory against the Nazis if after some years both the US and USSR left Germany, and in the following day the Nazis were setting up concentration camps again.
If they had held dominion over the Nazis for the entire time they were there and left voluntarily because they felt all of a sudden it wasn't there fight, it wouldn't be wrong to do so.
It's kind of like a UFC fighter pinning his opponent for 90% of the match and then suddenly forfeiting. I wouldn't call it fleeing or losing.
My point was simply that the US had complete dominion over the area for 20 years and left voluntarily, not due to any pressure from the enemy. If you don't want to call that a victory, fine, whatever, but it doesn't seem like a surrender or loss to me.
Losing money, troops and public support in the field and back at home is a very real definition of losing.
It sure as hell wasn’t winning.
Retreating voluntarily because of nothing to do with their opposition, sure as hell isn't losing.
Instead of going back and forth constantly with this semantic bullshit, can we just agree at the least the US didn't retreat because the taliban forced and pressured them to?
https://irregularwarfare.org/articles/learning-from-failure-...
But I'm the end, who had to flee and who is in power in Afghanistan since then?
No one fled.
What did the US get?
https://www.usip.org/publications/2022/11/afghanistan-was-lo...
It improved the quality of life and security for the people their immeasurably positively. If the withdrawal had not happened, and better leadership was displayed, the would have been completely wiped out.
What they were trying to get, was another ally in the region. They could have to, if it weren't for poor leadership.
Those things have not been achieved. If those were the aims, the US lost and the Teliban won.
That's one way to look at it sure. From a purely force against force perspective though, they didn't come anywhere close to losing.
Yes, I agree. The US saw this as a military problem, but that was only part of it. Winning a particular ground battle, capturing a town etc was only part of what was needed.
The question then becomes "A rich man may be able to dodge taxes, but can he dodge drones?"
Technology is a race between offense and defense and right now we're seeing offense leapfrog defense.
The status quo that we've known our whole lives has meant that anyone trying to assassinate a powerful figure will only get one shot at it before they're caught which does not allow them to learn from their mistakes and sends a chilling message to others who would do the same.
With remote controlled or autonomous drones the dynamic changes because people can operate from a distance -- perhaps even in an entirely different country that doesn't extradite. What's the defense against that?
At the end of the day the attacker only has to succeed once whereas the defender has to succeed every single time.
There may come a time where the ultra-wealthy and powerful decide that it isn't viable for them to be out in public due to the security risks so they will retire to a gilded cage -- which is still a cage -- and what's worse it reduces the search space for attackers to find them.
This doesn't even get into the near future advancements in biotechnology that will allow small groups of dedicated people to develop biological weapons that selectively target a wealthy person's family -- how can they defend themselves against that other than going into a fully sealed environment?
At the end of the day it'll end up being easier and better for these people to just make decisions that benefit the world at large instead of decisions that benefit themselves to the detriment of everyone else.
If you piss less people off less people want to kill you and in fact more people will want to defend you.
At least they will leech elsewhere.
Seems great for everyone other than US defense contractors.
Not really. Europe needs to rearm in a hurry, and by a lot. There is not way to do that without help from the US defense contractors.
I suppose that could be interesting for wealth that isn't liquid?
> "They were asking me to pay taxes on money I didn't have," Payre said. "I had no choice but to leave the country."
> 1997, he owned shares that were worth $110 million -- on paper. French tax authorities required Payre to pay a wealth tax of 2.2 percent on the shares, based on what the shares would have been worth had he sold them at the market's highest point.
> But Payre said that he didn't have access to them because of stock market regulations that limited his ability to sell and that, in any case, a market dip had devalued the shares below that peak.
Say you put all your savings into the market. You have $400K in assets and the government wants 20% of it ($80K), you either tighten your belt or you sell assets.
The wealthy, of course, will be in much better shape to handle this than your average guy who invested some of their income.
Take possession of parts of their stock in a blind trust and just get dividends or take out loans against the stock and use that cash.
This happens every time. Socialist government nationalizes businesses, drives most of them into the ground.
Because you want to be in Paris. We’re also entering another xenophobic era. There is an argument to be made that the safest place for a Frenchman is probably in France. (Obvious counterpoints to that. And I’m speaking as an immigrant American.)
Paris isn’t Paris if Moscow invades.
The only economist I still here talking about it is Laffer, for obvious reasons.
That's some quality assumptions you're making there, but whatevs.
You're the person who brought up the Laffer curve. Apparently (so Wikipedia tells me) https://en.wikipedia.org/wiki/Laffer_curve (section income tax rate as which revenue is maximised) around 65% is the point at which taxes stop being as effective.
That's interesting to me as I would have thought it was lower.
Note that because of how economics work, this number is from correlational data so is probably not as robust as an experimental approach might be (but unfortunately that's basically impossible to implement).
Both the French and the Brits have nukes. They're at no risk of hostile foreign invasion and everybody knows it. Entire libraries of books and whitepapers have been written about it.
If it were about self-defense: Build more nukes, build some mobile launchers capable of also launching targeting satellites, maintain the missile and submarine fleets, and your job is done. This can be done on current military budgets, or even smaller budgets.
It's not for "self defense". It's for foreign adventurism and geopolitical posturing. Like the opposite of realpolitik.
Besides, waging proxy wars is very far removed from self-defense.
Building outposts in, e.g., Cameroon to ward against Russian aggression over there is perhaps justifiable in some abstract respect, but it's rather the opposite of self-defense. (Without getting into complicated game-theoretical "we have to stop them over there so we don't fight them over here" justifications, which have long been discredited and have even become something of a joke.)
High paid workers, due to their skills are way more mobile than asset owners. I can be a software engineer in the Bay or Canary Wharf, but if I am a real estate tycoon, it’s not like I can take British homes with me to the US.
Since the latter is absolutely political suicide, there is an attempt to do the former.
What's the worst that could happen? It's not like the rich pay taxes anyway - they just setup foreign shell companies (a la Panama papers).
[1] https://www.telegraph.co.uk/politics/2025/01/22/millionaire-...
Good. They were making houses more expensive and not paying taxes anyway.
What do you mean by donations? A 'donation' is the typical way to refer to giving money to a charity. Are you saying that charitable donations should be taxed?
I am not sure I'd agree.
It was conceived in a time when all wealth arose from land, and doesn't account for a service or knowledge economy.
The ultra rich don't get that way from accumulating land, they accumulate intangible contracts and earning rights, 1s and 0s on a server.
The only answer I have heard from georgists is that the costs would would be passed from all of the teachers, farmers, and laborers to the ultra rich.
If that that were true, we could just replace everything with a sales or value added taxes.
I find that georgism appeals to a segment of people who are entirely preoccupied by urban real estate prices, and haven't thought through the implications for the broader economy
https://en.m.wikipedia.org/wiki/Land_(economics)
> Examples include […] and portions of the electromagnetic spectrum. Supply of these resources is fixed.
I even saw some folks argue that IP should be considered a form of land, although I’m not sure if this is a real opinion or some very-online-economics silliness. Anyway, maybe worth looking into.
—
> If that that were true, we could just replace everything with a sales or value added taxes.
I don’t see how this really follows. Land value is more like a wealth tax than an income tax, right? In the sense that it taxes something held, rather than inflow/outflow.
I agree it is on possession, or something held. The proposition follows not from that property, but the idea that taxes would "trickle up". The idea that it doesnt matter if warren buffet no little land, because taxes levied on farmers and renters would pass on the costs.
Land is much more evenly distributed than wealth and income. Similarly, consumption is much flatter than income.
I dunno. The existence of Warren Buffet-s is something that a lot of people object to. But, I think if the very rich exist, but are not hoarding the gains of natural resources too much, it isn’t really a huge problem. If he gets a bunch of money through making good calls as to which businesses will be productive, that’s good for society as a whole. As long as that productivity doesn’t come from extracting rents.
If the startup is able to produce a lot of value without taking much land, shouldn't that by encouraged? The employees will all buy houses with their earnings and pay tax on that land. They'll invest their money in other companies that also pay land tax. They'll buy groceries, supporting the store you mentioned. Etc.
The startup's URL is also "land" and should be taxed.
Many countries have confiscated everything from the rich, driven them out, and even mass murdered them. None resulted in the poor being better off - things just got worse for the poor.
Can you suggest some sort of middle ground?
Those rates were never paid, as the tax code also allowed for all sorts of deductions and tax shelters. What Reagan did was lower the tax rate in exchange for getting rid of those deductions and tax shelters.
The trouble with tax shelters is they tended to be crummy investments. The tax code incentivized shifting investment money from productive investments to crummy investments. This is not good for the economy.
Or look at it this way. If Musk was taxed at 91%, there would be no SpaceX, Starlink nor Neuralink. What wealthy people do is invest the money (you can only spend so much money on fine dining and snazzy clothes). Investing the money creates jobs and wealth that make the rest of us prosperous.
Wealthy individuals and corporations still invested because the tax code encouraged reinvestment into productive ventures like infrastructure, research, and business expansion rather than hoarding wealth.
Reagan’s reforms didn’t simply eliminate crummy tax shelters—they slashed the top rate to 28%, which kicked off a massive concentration of wealth. And the idea that the wealthy always reinvest their money into productive ventures is a just-so story that is more myth than reality. A lot of that wealth today goes into stock buybacks, speculative assets, and offshore accounts that don’t create jobs or grow the economy.
Musk and his ventures are a terrible example. SpaceX and Starlink wouldn’t exist without billions in government contracts and subsidies. Public money was a huge driver of their success, not just private capital.
The idea that lowering taxes for the ultra-wealthy benefits everyone just doesn’t hold up to scrutiny.
But let's flip things, What tax rate do you think the ultra-wealthy should be subject to? Why that number? Personally, I don't claim to know enough about economics to be certain about this but I feel that the 1950s-1960s in America was a time of great growth for the middle class and government funded technological development and that the tax policy of the time likely played a large part in that.
If you make $100,000, at a 91% tax rate you'd have $9,000 left over to invest. If you are taxed at 28%, you'd have $72,000 left to invest. $72,000 is greater than $9,000.
> And the economy didn’t collapse under those high rates
Right, because they weren't actually paying those rates.
> hoarding wealth
The wealthy do not hoard wealth. There are no Scrooge McDuck cash vaults. All their money is invested, not hoarded. If you tax the money away, it is no longer invested.
> kicked off a massive concentration of wealth
Wealth creation is not "concentrating" wealth. Wealth is not a fixed pie.
Musk did get government contracts for rockets. If he hadn't successfully delivered the goods, he wouldn't have been paid. Those rockets also cost 10% of what it would have cost NASA otherwise. A government contract is not a subsidy. SpaceX and Starlink were not subsidized.
I subscribe to C. Northcote Parkinson's observation that a 10% flat tax makes for the most prosperous economy while providing sufficient funding for the government. (He's mainly remembered for Parkinson's Law.)
> A lot of that wealth today goes into stock buybacks, speculative assets, and offshore accounts that don’t create jobs or grow the economy.
They do, except for offshore accounts, which benefit other countries. (All investments are speculative.) Stock buybacks are also investments.
This is a misunderstanding of how marginal tax rates work. A 91% marginal rate only applies to income above a very high threshold. In the 50s and 60s, that rate didn’t kick in until income hit around $2 million in today’s dollars. So no, someone making $100,000 wasn’t being taxed at 91%. And the ultra-wealthy still had plenty of money left over to invest after deductions and shelters, which is why the economy grew so well.
> Right, because they weren’t actually paying those rates.
True, but they were still paying effective rates that were much higher than today’s ultra-wealthy. The top 0.01% today often pay effective rates around 20%, while back then, even after deductions, they were paying closer to 50-60%. That’s a big difference, and it contributed to a more equitable economy. Do you think that the economy is healthier today and that this is a result of the current tax policy?
> The wealthy do not hoard wealth. There are no Scrooge McDuck cash vaults. All their money is invested, not hoarded. If you tax the money away, it is no longer invested.
This is a cute image, but “hoarding” doesn’t mean stuffing cash under a mattress. Hoarding happens when money is funneled into assets that don’t circulate productively in the economy—things like luxury real estate, golf courses, art, or stock buybacks that inflate share prices without creating value. Investing in financial instruments that primarily benefit the ultra-wealthy doesn’t generate the kind of broad-based economic growth that happens when money flows through the middle class.
> Wealth creation is not “concentrating” wealth. Wealth is not a fixed pie.
True, but wealth concentration is still a problem. While wealth isn’t a zero-sum game, extreme concentration reduces economic mobility and slows down overall growth. When too much money pools at the top, it reduces aggregate demand, which is what drives a healthy economy. If you don't think that this is a problem with current levels of wealth distribution, what levels of wealth inequality would we have to see for you to consider a problem?
> A government contract is not a subsidy. SpaceX and Starlink were not subsidized.
This is semantics. SpaceX received millions in government contracts before proving its capabilities. Early-stage government money often functions as a de facto subsidy, reducing risk for the private sector. NASA essentially de-risked SpaceX’s early development, and without that, it’s unlikely SpaceX would have succeeded. Government contracts don’t magically appear out of nowhere—someone took a bet on Musk, and it was with taxpayer money. I think that's great, but we should have more tax money to make these kinds of bets and we can get that money by having higher taxes on the ultra-wealthy.
> I subscribe to C. Northcote Parkinson's observation that a 10% flat tax makes for the most prosperous economy while providing sufficient funding for the government.
A 10% flat tax? That’s fantasy land. It’s a cute theory that ignores the realities of modern economies. Flat taxes disproportionately burden the poor and middle class while letting the ultra-wealthy off the hook. There’s a reason no prosperous nation has implemented a flat tax at that level and maintained the kind of infrastructure, education, and public services necessary for sustained growth.
Even Estonia, often held up as a model of flat taxation, doesn’t follow that script. Estonia’s system isn’t a pure flat tax—there’s a 20% flat income tax plus a 33% payroll tax for social services. And importantly, Estonia relies heavily on VAT (value-added tax), which disproportionately impacts lower-income households.
> Stock buybacks are also investments.
Not really. Stock buybacks are often a way to boost share prices and executive bonuses. They don’t add productive value to the economy or create jobs. In fact, before 1982, they were considered a form of market manipulation and were illegal.
1. Yes, I am well aware marginal tax rates. For a rich person, the marginal tax rate asymptotically approaches all of the income. You didn't reply to my point, though, that money you tax away from people takes away from their investments. This is the point behind an IRA, FWIW.
2. No, they were not. They were tax sheltering their income. Nobody paid anything near 91%, unless they did not hire a tax accountant, which would be stupid. Wealthy people are rarely stupid with money, that's why they're rich. (ESPN ran a documentary once about NFL players suddenly becoming rich and just as suddenly going bankrupt because they had no idea how to manage it.)
3. Art is an investment (they expect it to appreciate). So are golf courses (golf players pay to use it). So is luxury real estate (real estate appreciates). Stock buybacks mean buying stock, which is an investment.
4. There's no evidence that "extreme concentration" does anything of the sort, especially since wealth is created, not concentrated. Bob creating more money does not take anything away from Fred. Bill Gates never took any money from me. Neither did Steve Jobs, nor Elon Musk, nor Jeff Bezos. Nor did they ever take money from you.
5. It is not semantics. Having an exchange at market prices is NOT a subsidy. A subsidy is a gift of money. NASA did not buy those rockets as a gift to SpaceX. NASA bought them because they cost 10% of what NASA rockets cost, and NASA used them. NASA did not bet on Musk. If the rockets didn't work, Musk would not have been paid. Musk was losing money, and one more explosion would have bankrupted him. But that one flew, and Musk got paid. NASA did not take a risk on Musk. Musk took the risk.
6. Parkinson is a better economist than you or I. Why not read his books? They're quite good. Do you know the US did not have an income tax until 1913? It was quite prosperous, including public education.
7. Stock buybacks are a method of distributing profits to shareholders without the high tax rate on dividends.
This is wildly incorrect, in that the purpose of stock buybacks is to reduce the number of shares and juice metrics like earnings per share (which weirdly enough, lots of CxOs are bonused on).
> Yes, I am well aware marginal tax rates. For a rich person, the marginal tax rate asymptotically approaches all of the income. You didn't reply to my point, though, that money you tax away from people takes away from their investments. This is the point behind an IRA, FWIW.
Your first comment (around the 100k income and different tax rates) had the weird marginal/total tax rate confusion, so if you'd prefer to avoid that be more clear in the future. As an example, I pay 52% marginal, but about 35% overall.
> 7. Stock buybacks are a method of distributing profits to shareholders without the high tax rate on dividends.
Correct, but I think this is a bad way and encoyurages non optimal behaviour.
As I said, stock buybacks are a method of distributing profits to shareholders without the high tax rate on dividends. That's why it's done, though another reason is to invest in one's own company, which is done in the belief that one's own company is a better investment than investing in others.
There's nothing nefarious about it.
> had the weird marginal/total tax rate confusion
I simplified it to emphasize that taxing money away from someone leaves them with less money to invest. The issue of tax rates being marginal is irrelevant to that point. Also, for a high income person which is what we are talking about, the marginal tax rate is his overall tax rate.
This isn't generally true. I'm in the top 5% of income earners in my country, and my marginal and effective tax rates differ by a significant amount (35 effective vs 52 marginal).
> As I said, stock buybacks are a method of distributing profits to shareholders without the high tax rate on dividends. That's why it's done, though another reason is to invest in one's own company, which is done in the belief that one's own company is a better investment than investing in others.
That's certainly one rationale. Personally, I dislike them in most cases (they make sense for companies that provide a bunch of compensation in stock). I personally think that dividends encourage market behaviour that is better (I'd never have sold my FB stock if they'd paid me a dividend), as well as reducing number go up as the only way to gain money from investing.
> though another reason is to invest in one's own company, which is done in the belief that one's own company is a better investment than investing in others.
This is really dodgy from my perspective as by definition, a company has more information about their future earnings than another investor does. I realise that this ship has sailed, but personally I'd prefer to reduce dividend taxes for re-investments and ban most buybacks (but again, this is probably a niche position).
Generally, if governments foresee the need to encourage economic activity, they should reduce tax rates. If they predict their economy is or will become overheated, they should increase tax rates. If they wish to buy votes from people who don't understand how money and tax work in an untethered fiat currency world, they should increase tax rates into the 90%+ range; however, this will cause economic disruption with some time delay, which those responsible will hope they can blame on the party in power at the time of the disruption.
Yes, I am more cynical now than I was 20 years ago.
NYC has also seen an exodus of wealthy taxpayers to Florida.
The claim here is that high taxes on earnings will cause capitalists to leave and take the jerbs with them. A different context, and a scenario that fails to consider the existence of domestic competition, capitalists' desire to sell into the most profitable market, preferences about where to live etc.
>They outsourced industry, because the logic of industrial production is that all costs should be driven as low as possible and much human labor is fungible.
It's not just industrial production, it's the top jobs that people on this site need. Jobs in software and other kinds of engineering are increasingly under threat. There is some merit to seeking lower costs, and we benefit from that, but it's also possible to paint yourself into a corner from a national security standpoint. My point remains: the same cost-saving motive that drives wealthy people to preserve money in life and business is likely to push them out of the country if we oppress them.
There are many real-life examples of people fleeing for economic reasons. Why is it so easy to believe that day laborers or doctors would flee for greener pastures, but hard to believe that many wealthy business owners wouldn't?
Seattle has instituted a number of punitive taxes on businesses in the city. There has been a corresponding boom in business across the lake in Bellevue.
The state has benefited a lot by being a low tax state in the past. It is no longer a low tax state. We'll see how that goes.
Musk is one of the more famous industrialists who left California over taxes.
Peace through poverty in Europe would be an interesting development I suppose.
Given that there's a lot more than 10 thousand millionaires in Britain and they are sticking around to pay taxes (more than enough to cover the $5b from those who left), I don't see how that's actually a bad thing?
And where they will go? Once a major developed nation starts being serious on taxing the billionaires, the others will follow soon, or more probably, they will even coordinate among themselves to harmonize their rates.
Yeah, they could go to some third world hellhole where they could bribe the authorities and live in a Pablo Escobar's style compound. Will they do it? Will they subject themselves to the judicial insecurity that abunds in those places? To politician that manage the incredible feat of being orders of magnitude even more corrupt than the ones we have in washington?
All western nations used to have far higher top marginal rates for income and inheritance taxes. Far less loopholes, and yet here we are.
When western nations had far higher top marginal rates for income there were far MORE loopholes, not less. Those high rates did not bring in much revenue. For example:
>...Of the $517 billion the Treasury collected in 1980, only $3 billion to $5 billion came from the 70 percent bracket — less than 1 percent of total tax revenue.
https://www.politico.com/agenda/story/2019/02/05/democrats-7...
(This is one reason that democrats suggested lowering the top rate in 1981.)
Those high marginal rates encouraged all kinds of unproductive investments to take advantage of loopholes built into the law. Where people couldn't get around such high rates, there were deadweight losses from economic activity that didn't occur. Even if someone thinks it is morally ok to take that much of someone's income, those kinds of high rates simply hurt the economy.
We are discussing making a fairer tax system were billionaires pay more of a fair share, we are not proposing full communism where we confiscate all their money.
Is any marginal increase on taxes fatally destined to lead to capital flight? It looks like a lot of people are arguing exactly that. Well, in that case lets stop completely taxing the oligarchs! Trickle down stravaganza now!
That's exactly what is usually being proposed - the difference is confiscating everything slowly over decades (rather than by immediate revolution).
The deception is that a 2% tax sounds tiny. If you have a retirement portfolio and are withdrawing money to live (drawdown) then that 2% can easily take > 50% of your wealth over decades. Financial literacy is understanding the power of compounding - yet when it is in reverse it isn't obvious. And when the victims are somebody else (people wealthier than yourself) we conveniently shut our ears to any complaints.
Ironically I think the core motivations of most proponents of wealth taxes are their own greed and envy. Tax anybody else but not moi...
The systematic driver is our aging demographics. Our governments need new taxes to pay for the infinite demand of health services, and the demands of the voting 65yo+ welfare state beneficiaries
Our years of fiscal irresponsability, of adventures like ZIRP, Quantitative Easings and Stymulus made the rich even richer. Asset Inflation for the rich and purchasing power corrosion for the pleb is all cool and dandy, but it is destroying our societies, and the way we have to fix it is by reversing decades of Lobby facilitated regressive tax policies.
The billionaires benefit from having an educated society to work for them, infrastructure, the rule of law, security from thiefs as well as from foreign governments and organizations. The USMC existence is far more important for big oil magnates than for a public school teacher in Chicago.
I was lucky, I am generation X and I still managed to have a fully paid mortage, a decent, albeit modest, retirement fund, but what about my kids? What world are we leaving them? How can I look him in the eyes and tell, well kid, you're doing great on school, but sometimes I wonder if you shouldn't be playing because our government thinks that you having your own house in the future is something to be decided by the "free"markets, but at the same time, let's subsidize Big Tech to the tune of billions so they can build AI to make sure you won't have a job and will forever live of whatever I manage to pass to you or be a UBI slave.
Because you and I know that all this government money going to AI is motivated by the greed of oligarchs salivating at the prospect of shedding off whole mountains out of their payrolls.
Inflation is never a problem for this system when it is mostly confined to asset inflation. But as soon as we have too little unemployment, and workers start having to mute linked-in recruiter notifications, the calls for austerity start immediatly.
You complain about the poor acting politically for a more progressive taxation system, but why then the rich don't stop lobbying for subsides, why they don't stop lobbying for wars? Isn't it clear that they are they motivated by greed too and will use political power too to satisfy it?
Authoritarian regimes aren't very pleasant places to live, which is why Russian oligarchs send their families abroad.
Eventually they will have farted in all the elevators and they'll have to sit in their own stink.
Even his staunchly socialist regime had to admit its failure and abruptly reverse course in 2014, two years later. The tax raised just €260m in 2013 and €160m in 2014…. But caused an exodus of wealth and job creators
And did they end up coming back?
Payre built a successful high-tech company. Payre said the French government sent him a tax bill of nearly $2.5 million on paper assets he couldn't cash in. Payre moved his family to neighboring Belgium. Payre started a new company in Brussels that he said did nearly $32 million
Taittinger, who helped create the champagne label, said the French tax system not only helped force the sale of his family company but scattered the 38 family members involved in the corporation. "Half of my family left France because of taxes," said Taittinger. "They now live in England, Belgium and other countries where they were warmly welcomed -- unlike here."
Eric Pinchet, author of a French tax guide, estimates the wealth tax earns the government about $2.6 billion a year but has cost the country more than $125 billion in capital flight since 1998.
What people imagine this means is a tax on rich people. An appartment in the center of paris costs about 10.000 per month. If you calculate how much you need to own to afford that on interest income alone, it's 120000/4% = 3,000,000. Make it 4 million to cover eating out every day as well. That would be the lowest level I would see as super-rich.
But wealth tax, where it exists (e.g. Switzerland) starts at 111.059. This is in a country where a downpayment for a basic apartment would be at least 160000 (but more likely 200.000). So even in famously not-super-low-but-still-pretty-low-tax-Switzerland it's mostly taxing what you would call "professionals". People with a decent, but not spectacular, job (accountant, programmer, ... not FANG wages or doctors). Oh, and looking at the country's finances it becomes immediately clear: Switzerland is low tax because it also has very low unemployment/social support and very low pensions.
The solution to this USED to be inflation, government deficits of 10% even 20% in Southern Europe (before the euro was introduced, which transferred control of inflation to the independent ECB, preventing government deficits financed by inflation, as was the norm in the 1980s and 1990s for example)