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The shares aren’t being taxed. The ultra-wealthy individual is being taxed on their “excess” wealth, which is held in the form of these shares.
Personally, I wouldn’t tax “all” wealth. It does us no economic harm for them to own a billion dollar mansion or yacht or other tangible asset.
I would only tax registered securities: the vehicles by which these individuals gain wealth. Every year they are worth more than 99.5% of the population, I would transfer a small percentage of their wealth-generating assets out of their hands, to be resold at government auction.
The net effect of this will be that the 99.5% of us will come to own a greater percentage of these wealth-generating assets.
We aren’t taxing your profits. We are taxing you. That is the entire point of a wealth tax.
Personally, I wouldn’t tax all forms of wealth. I would ignore personal property, intellectual property, real property. I would only tax securities. I would drive the wealthiest among us to pull their excess wealth out of the securities markets.
I don’t have a problem with the richest among us acquiring all the luxury goods they could imagine. Want a mansion? Have 10. A yacht for every week of the year? Go nuts. Go put a bunch of carpenters and boatwrights to work.
The problem isn’t their consumption. The problem is their frugality: they aren’t buying those mansions, those yachts. They aren’t employing those carpenters and boatwrights. They are using their wealth only to purchase the means of acquiring more wealth.
Instead of buying the products produced by a factory, they are buying the factory itself, and taking a larger and larger share of its revenue.
The fact that we have nothing to systematically disincentivize this behavior is the root cause of economic disparity today. A wealth tax is a first real step in solving this problem.