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> A wealth tax, where a fraction of your bank balance is removed every month, is a totally alien concept to most people. If you haven't thought about it before, it can take a minute or two to wrap your head around what it would actually mean.

Many Americans already experience a form of wealth tax: property tax. You are taxed a percentage of the value of your property, something not terribly liquid.

Incidentally, a handful of states prefer to tax wealth in the form of property rather than income (Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming)

Car tax and land tax are two very common existing wealth taxes. I wonder why they are rarely described as a wealth tax.

I think it's because they people you normally think of as "wealthy" don't have most of their property in the form of house or car - only the poor or the shrinking middle class that's the case.

Car and land cost money for the state, you get a "direct service" from your tax. And wealthy people have lower rate (compared to their revenue and wealth) than the average Joe

Here we talk about a tax without a "direct service" associated... but that would be paid only by the wealthy, not by the average Joe

There is a good reason property tax isn't quite like a wealth tax: property tax is used to pay for services provided by the municipality (schools, libraries, roads).

More similar to the wealth tax would be the so-called https://en.wikipedia.org/wiki/Land_value_tax that does make the rich pay for "hoarding" land as a commodity, without creating the the disincentive to improve the land (which is a side effect of property tax, which is levied on the value of the entire lot + buildings)

>property tax is used to pay for services provided by the municipality (schools, libraries, roads).

Would not a wealth tax also pay for services that provided to that wealth? For example, especially at the billionaire level, there is an entire national defense and internal legal system that prevents others from seizing the wealth for themselves.

1. Many people rent, and have never seen a property tax bill, despite paying it indirectly via their landlord.

2. It's not the same thing. You can choose how extravagant a house to live in relative to your total wealth and your income to make sure that you can cover the property tax bill while still meeting your saving goals.

An "everything else" wealth tax, (by definition) doesn't allow you to do that. Your control over how aggressively you want to save or spend is greatly reduced by an overall wealth tax.

> 2. It's not the same thing. You can choose how extravagant a house to live in relative to your total wealth and your income to make sure that you can cover the property tax bill while still meeting your saving goals.

This isn't really true. Yes, I can control the value of my home at a single point in time but if my neighborhood gentrifies, even if I make no improvements to my home, my taxes will go up. You can technically plead your case to the tax assessor and argue that because your bathrooms and kitchens are "obsolete" you technically shouldn't be valued as high as your neighbors but your taxes are going up regardless.

I understand that in California there are rules around how often they can raise your property taxes, but for nearly everyone else if your home value goes up so will your taxes.

You can move when it gets too unbearable. You wouldn't be able to do the same with your savings.

Given the nature of the wealth taxes that have been proposed, you will never become homeless or destitute. Having to pay a few points above 20 or 50 mil or whatever is not going to break anyone the way property taxes will and do.

Moving isn't free, and it can be a burdensome expense. When the housing crisis a lot of people had personal financial issues because divesting from the mortgage they were engaged with and acquiring a more modest property would still involve being taxed on the full value of your house, expenses involved with the mechanics of changing residences, and then somehow affording a down payment on a new place - or else being forced to declare bankruptcy and re-enter the renting market with nothing but fresh income.

The technical concept is that housing is an illiquid asset - there is a friction in converting it to cash, that friction may be monetary (a fee, taxes, a loss of value, sale prices etc...) or it may be time (conversion may simply not be an action that can be executed at will, there may be windows or complex ownership hand-off processes that require weird timing) in the most common cases (including housing) the asset is liquidatable with value generally decrease relative to speed, offloading a property with a fixed window of a month will net you less revenue then having a sale posted for an extended period - having a sale window of a week or less would almost certainly result in a much decreased sale price.

Florida (counties?) also caps that rate of yearly increase on property taxes, especially for homesteads.

Every thing of wealth requires protection. Lack of an army and government to protect your wealth and it will be plundered by the masses. With Citizens United I have no problem letting every dollar now be taxed the same as a person. Have two taxes, one applied equally for every individual and one applied evenly to every dollar of wealth. Wouldn't that be representation with taxation? It'd be like the Senate (every state gets the same equal representation) and the House (states with more people pay more taxes)...

I'd also argue that property taxes are a regressive form of wealth tax. For the average homeowner with a mortgage, they are taxed on an amount largely tied to the size of the mortgage and not their wealth. Also, most homeowner's primary source of net worth is equity in their homes, so they are effectively taxed on an amount exceeding their net worth.

Look at the following two individuals. Both live in $1MM homes with 1% property tax rates.

Individual A: - $200k equity in house - No other assets/savings - $10K property tax/year

Individual B: - $200k equity in house - $50MM stock portfolio - $10K property tax/year

A is paying 5% of their net worth in 'wealth' taxes, while B is paying 0.02% of their net worth in 'wealth' taxes. This is clearly absurd and should be fixed.

It's not totally alien at all. It's the way we finance nearly all our local governments and school systems.

Tallying up property and paying a tax on it annually is something literally everyone does.

I would venture a guess that "property tax" doesn't quite feel the same as a wealth tax to most people, because most people don't have a paid-off house, so it's just one more component of their mortgage (and paid through an escrow account rather than directly). If you're paying a large aggregated bill anyway, it feels like just one more tax associated with money changing hands.

If your house is fully paid off, such that your only remaining costs on it are property taxes and insurance, then you're already far more well-off than the majority of people.

Also, financing schools and other local services via property taxes is a bad idea; doing so perpetuates inequality by giving more funding to services in more expensive neighborhoods.

> I would venture a guess that "property tax" doesn't quite feel the same as a wealth tax to most people

I mean, who cares? This is a tax on people with eight figure fortunes we're talking about. The only issue at hand was can the unwashed masses grok the basic concept here. The answer is of course they can. Sometimes you pay tax on value you earn, sometimes on value you give away, and sometimes on value you have. We all do it all the time on all three counts.

I don't care all that much about the taxes of people who have tens of millions, and I'm all for finding ways to fund better safety nets.

I do care that such taxes have a tendency to spread to lower tax brackets, once they're perceived as acceptable at all. I don't want to see wealth taxes being assessed on people in the "finally paid off the house" bracket, or the "successfully saved for retirement" bracket. And as long as those brackets are above the median wealth, there's a serious danger of that happening. It's much easier to argue against wealth taxes before they exist at all, and much harder to continuously keep them from affecting more people.

(Example: if wealth taxes become acceptable, I would not be at all surprised if people in areas where houses still cost 5 figures support wealth taxes at a level that affects people just like them who happen to live in areas where houses cost more. Arbitrary wealth taxes are not a power I trust politicians with, no matter how much they promise not to abuse them now.)

I also care that such taxes require much more invasive information-gathering (of much fuzzier information) to assess. (The value of property that isn't directly denominated in currency and isn't in the process of being bought or sold for currency is quite fuzzy.) Other parts of this thread already cover various aspects of that issue, though.

> Sometimes you pay tax on value you earn, sometimes on value you give away, and sometimes on value you have.

Taxes on "value you have" are quite rare; taxes on homes/land are just about the only common example, and those are already controversial for a variety of reasons.

>In a survey context, all of these questions can be answered on autopilot by mistaking "wealth tax for rich people" with "higher taxes for rich people," which are definitely not the same thing.

That was my impression as well. I'd bet money that a large number of the respondents didn't really understand the question. I would love to see the exact question stated somewhere.

I think this is likely even if the survey authors we're careful with the wording, which I believe they were.

Several responses are blasting me for thinking that people are stupid. I wasn't trying to claim that everyone made this mistake, only that it looks like it would have been an easy mistake to make, given most people's experiences.

Also many people pay rent, and are unfamiliar with property taxes.

The wording used in the survey is included in the article.

> “the very rich should contribute an extra share of their total wealth each year to support public programs”

They included "extra share" and "total wealth". I think that's quite clear and 64% strongly or somewhat agreed with that statement.

> “the very rich should be allowed to keep the money they have, even if that means increasing inequality”

54% of respondents disagreed with that statement.

Seems pretty clear cut and understandable.

I agree with you that the authors probably tried to make this clear. My suspicion is based less on "sneaky pollsters" or "stupid people" as some comments suggest, and more on my observation that people tend to rush through surveys. When you're rushing, I think it would be easy to make a mistake like this.

I think most Americans already get taxed on their bank balance, by their bank, inversely proportionate to how much they have, so it's not alien from that side - and it's also pretty much identical to real estate taxes which people are already used to paying... in fact a good way to sell a wealth tax might be by saying "Hey, you know how you pay taxes on your property? There are people out there so rich that they've got millions not even tied up in assets, maybe that wealth of theirs should be taxed the same as the wealth of yours - And don't forget, you don't even fully own your property, the bank has half."

It's an interesting way to consider the tax.

Sure, but if you understand this concept, you're not likely mistaking wealth for income on a survey.

Oh - that's why I mentioned it... if you wanted to ensure fairness it might be a good tactic to state the question with a clear analogy like property taxes as a reference.

This is not true at all.

People are already familiar with property taxes. They pay them for their houses every year. In some US states they even pay property taxes on their cars.

However, there is no property tax on stocks, bonds, etc, which is how the rich store most of their wealth. So people pay taxes on their houses, but Bezos doesn't pay pretty much anything on his enormous giga-wealth.

I don’t mind a tax on my bank balance over $32,000,000 for example. I would need multiple lifetimes to spend so much money. Most of my money comes to me from real estate ownership and investments. I do not exchange time and life force for it. My bank account just grows.

It is ok some of it to pay taxes to make the lives of the less fortunate a bit less unbearable. After all I take 25-35% of their incomes in rent :)

(Note: well, I don’t really have such a bank account but if I did, I wouldn’t mind the tax)

I agree with you in principle on this particular example, but where is the cutoff, and how often will it move? Will it move accurately, or will inflation be used to sneak it downward?

I am so not worried if the ultra rich will have a cutoff allowing them 20 or 25 or 27.5 lifetimes lived in luxury without the need to work. This is not where my concern lies.

I don't think most Americans would have a tax on their bank balance. Hence, wealth tax on the rich.

They asked if rich people should pay taxes for being rich. This has nothing to do with regular people. This is the EXACT same gas-lighting technique used by the wealthy and their lobbyists to convince gullible employees that they have something in common with their boss.

why have such low confidence in the intelligence of Americans?

people aren't dumb, and if it was just a higher income tax it would be called such.

It tends to be selective. When the speaker agrees with survey results, then it is clearly just common sense.

I don't think we should let politicians sneak this through unless we're confident that the public actually understands what is being proposed.

We shouldn't let politicians sneak this through regardless of what the public understands. Taxation is theft.

That's a rather extreme viewpoint, I would counter with the view that actual theft is theft and taxation paying to apprehend criminals, recover stolen property and discourage crime is actually the only thing between us and rampant theft.

I don't think it's extreme at all. It only seems that way because we've all be conditioned to accept taxation as something normal. But there's no particular reason why that must be so. And, as Bastiat points out, the Law is nothing more than the collective extension to our individual rights, and so can have no legitimate authority beyond what an individual can do. I can't collect money from you under threat of use of violent force, no matter how noble my intentions for that money. Ergo, "the law" / "the state" / "society" likewise have no standing to do so, except "might makes right".

From the Article:

>Majority of Americans favor wealth tax on ~~very rich~~

>A wealth tax, where a fraction of ~~your~~ bank balance is removed every month.

Most people's Bank accounts earn less than 1%. Maybe you didn't understand the question correctly.

>>I don't think most Americans want a tax on their bank balance.

This doesn't apply to _most_ Americans, this applies only to the very rich.