Also of interest: Taxes aren’t paid on stock buybacks which is why they became popular.
False@lemmy.world 1 day ago
This was an interesting point I hadn’t thought of before, so I wanted an alternate perspective since a Twitter meme is a little one sided:
Property taxes are ancient — they predate modern stock markets by centuries. Land was the dominant form of wealth, and crucially, you can’t hide a house from the assessor. Real estate is immobile, visible, and tied to a specific jurisdiction. Stocks are the opposite: mobile across borders, easy to hold through trusts or shell entities, and private holdings are genuinely hard to value year-over-year.
The other piece is who’s collecting and why. Property taxes are local — they fund schools, fire, roads, the stuff that directly makes your property more valuable. There’s a clean “benefit” logic: the city paves your street, your house is worth more, you pay for it. A share of Apple isn’t enhanced by Seattle paving anything, so there’s no equivalent local nexus.
Stocks also already get taxed, just at different moments rather than annually: capital gains when you sell, dividends when paid, corporate income tax on the underlying company, estate tax at death. The argument against an annual wealth-style tax is partly that the system already takes its cut, just not on a recurring basis.
A few countries (Norway, Switzerland, Spain) do tax financial wealth annually, but most that tried it abandoned it — capital flight and valuation headaches. In the US there’s also a constitutional wrinkle: the federal government can’t easily levy direct taxes on wealth without apportionment among states, which is why Warren/Sanders-style wealth tax proposals have to be carefully structured to survive a court challenge.
Klox@lemmy.world 1 day ago
4am@lemmy.zip 1 day ago
They’re not traced because they used to be illegal and they shouldn’t ever be taxed because they should be made illegal again.
HostilePasta@lemmy.ml 1 day ago
The same way prospect (futures) markets should be illegal, as well as options. The rich apparently couldn’t make enough with regular stocks so they had to build gambling into it, and then inside trade to make sure they won.
Burn it down.
sik0fewl@piefed.ca 23 hours ago
Should probably do both for when they inevitably become legal again.
SippyCup@lemmy.world 1 day ago
Because that used to be illegal so there was no need to tax it
3abas@lemmy.world 1 day ago
Stocks also already get taxed, just at different moments rather than annually: capital gains when you sell, dividends when paid, corporate income tax on the underlying company, estate tax at death. The argument against an annual wealth-style tax is partly that the system already takes its cut, just not on a recurring basis.
Yeah, that’s sort of the whole point of the post. If I buy a stock for $1 today and still it for $10 tomorrow, I pay taxes on the gains tomorrow.
If I buy it for $10 today and sell it for $1 tomorrow, I claim it as a loss.
If I buy a house for $100k yesterday, I’m paying taxes on $400k property today, and $900k tomorrow. Even if tomorrow I sell it for $200k.
tburkhol@slrpnk.net 1 day ago
For most of our history, real estate was wealth. You needed property to grow crops, mine resources, build a factory, or do any kind of venture that would make money. It’s only in the 20th century that we really start having a significant amount of wealth in stock markets that couldn’t be directly traced to a physical asset. The robber barons figured that was a good excuse to stop taxing their wealth.
Fribbizz@feddit.org 23 hours ago
Property taxes are local — they fund schools,
Funding schools by highly localized tax isn’t universal. The US adopted it to make sure less affluent areas have worse schools. I believe the UK does similar things, but they also want marked differences between public and private school alumnus.
but most that tried it abandoned it — capital flight and valuation headaches.
And most importantly: relentless lobbying by the wealthy to get rid of those taxes.
Artisian@lemmy.world 5 hours ago
source on the size of the effects of lobbying vs flight risk?
I would like to agree with you, its just very not-obvious which influence dominates.
Carrot@lemmy.today 1 day ago
The main issue is that, once you have enough value in stock, you can take loans out against it, thus extracting the value of the stock without actually having to sell the stock.
youcantreadthis@quokk.au 1 day ago
Let’s just say they won’t pay with money seems to be their current position
4am@lemmy.zip 1 day ago
The system should take more of a cut, if that’s the argument we are going with.
Also? A new realization event should be defined: collateralization. When you take out loans against the value of your stock/bond/whatever holdings, you are realizing gains from those assets - you wouldn’t have gotten the line of credit otherwise.
People argue that this would prevent homeowners for taking equity lines of credit for improvements but that’s easily remedied by the collateral not being a real asset.
almost_genocide@lemmy.world 2 hours ago
This is a pure red herring. County property assessors are a thing. We already have systems in place to address this concern.