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Comment by baq | Hacker News Reader

A functioning regulator would tax their wealth, but there doesn’t seem to be a legal way to do that properly

As a response they move their wealth overseas and renounce their citizenship if necessary. What strategy from the banana republic playbook would you like to see the State employ next?

Renouncing citizenship is a taxable event. If they don't pay up then arrest them. It's literally that simple.

If it’s that simple, do you care to list out all of the countries that do this?

No, I won't do a bunch of work because a stranger on the internet asked me to, but you can Google it yourself if you want.

It’s rhetorical. There are no successful wealth tax schemes.

Ok, then you're just wrong

No, there are no wealth tax schemes beyond property tax. It takes very little time into the implementation of a general wealth tax to realize it involves breaking up successful companies, which kills it in its place.

I disagree, there's plenty of ways of doing that without breaking up companies

Then deny them access to the US market. That will bring them back

It will bring them back to have their wealth arbitrarily expropriated? Yeah I doubt it. Never mind that it's unclear what it means to "deny them access to the US market" when these people are acting via working for / owning corporations. You're going to deny big corporations access to US markets based on the financial profiles of their owners? You're going to expect foreigners in general to surrender all their wealth in order to access US markets? Good luck enforcing that.

Would it make any difference? I'm a UK citizen. If I earned profits from a VC fund in San Francisco what are the chances of me paying only UK tax on that? You can also tax the fund directly and the corporations they invested in. You can tax the transfers of wealth between those entities. Of course you can tax these people if you want. Sure some of them will run to Belize, but the US control the domicile rules, tax them as you wish. Are they going to stay there forever? Tax income earned on US PE funds at source. Do whatever you like.

It is frankley pathetic to suggest you can't tax rich people or they will go abroad.

>If I earned profits from a VC fund in San Francisco what are the chances of me paying only UK tax on that? You can also tax the fund directly and the corporations they invested in. You can tax the transfers of wealth between those entities. Of course you can tax these people if you want. Sure some of them will run to Belize, but the US control the domicile rules, tax them as you wish. Are they going to stay there forever? Tax income earned on US PE funds at source.

Obviously you can tax income and put the mandate of enforcement on companies that are paying individuals. You cannot delegate the taxation of pre-existing wealth to companies though and deputize every firm as an IRS agent.

Further to that, I don't know how it is in the US, but in the UK VC firms are regulated. You can allow foreign investors fine...but this guy is a principal. You can apply whatever fit and proper persons test you like to the principals, such as no outstanding tax issues, and domicile if you want. You just need the political will.

That’s exactly what I had in mind when I said it’s legally impossible

A functioning regulator would know its place and not try to set tax policy. The legal way to do it properly is for congress to pass a bill.

In a wide market context when I say ’regulator’ I mean any and all forms of government, please excuse my imprecision

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