So lots of people saying the ultra rich are hard to tax because they take out loans against assets to fund the day-to-day. This then results in an argument about the morality/viability/etc of a wealth tax.
If you tax loans that means every credit card purchase or mortgage would trigger a tax. If you receive a $400k loan for a mortgage, that would mean something like $100k in taxes for an upper middle earner.
> Pawnshops are collateralized loans for the poor.
Yes, that's why I said "thresholds". Not suggesting we tax small loans (or a small total value of loans taken out by an individual, regardless of the value of the individual loans).
> wealth tax
By many people's estimation, a wealth tax is an elaborate scheme, because is unrealized wealth really wealth?
If Bezos has $100B in stock but a sale of all that stock would only fetch $60B, do we still tax on $100B? How can someone's wealth be realistically and equitably calculated if it is not realized? Putting fairness aside for a minute, you are probably severely underestimating the overhead / elaborateness of such calculations.
The government is funded by taxes and bond sales. Bond purchases absorb high interest rate demand across the entire market. If there weren't any taxes, there would be higher interest rates. So taxes are what subsidizes low interest rates. We're the ones paying the interest on their loans.
But... why can't we just tax the loans?