And this is why in most civilized countries, progressive income taxes make up the majority of the government budget. Basing taxes on non income/investment related metrics screws over the poor + lower middle class. It’s a transfer of wealth from the poor to the rich.
This doesn’t fit the narrative, but a lot of American states have lower effective property tax rates than European nations. There exceptions on both ends of this of course (like TX which is making up for a lack of income taxes).
People should look them up and compare European nations to major us cities and states. Europe ends up with not only higher income taxes, but also higher property taxes overall. And a completely insane financing method like having adjustable rate mortgages being normal, locked only for a period of 3 to 5 years before basically being forced to refinance. Little wonder that property ownership rates are generally so far below american ownership rates.
No system is perfect and people with means tend to find every flaw in them (and plant those flaws if they are wealthy enough). But people really need to remember that the grass is always greener because of all the manure.
And that man clearly does not live in such a state, nor did I (or anyone else I think) claim that his circumstances apply to the entire usa. You’re wrong in assuming that other people are not aware that different places have varying laws and tax systems.
Your whataboutism defence of regressive tax systems is also very strange to me. That other places have unfair practices in place, is no excuse to put up with an unfair system in any one place. Call them all out on their brokeness, but if you do call them out, you’ll have to be more specific in your example(s), state things that are actually verifiable instead of some vague whataboutism.
True, you just need to make sure you start high enough up, or exempt the value of a primary residence (maybe limit the exemption to a non-opulent value of a house so the richest don’t start building castles to bind their money tax free)
UK has property taxes too and its pretty shit tbh. Council tax, there are bands based on what your house was worth in the 90s (yes really…) and generally the poor will pay a higher % of their income. I have a pretty small bungalow, 60m². One of the lowest bands and pay £1600 a year on a house that cost £230k. The most you can have to pay is £4200, beyond that point regardless of how much more expensive your house is the tax rate doesn’t increase.
The original plan of the tax was a fixed rate per person. This among other things is why many people were keen on the idea of digging a hole so deep that we could hand Thatcher over to Satan personally.
That has to be the most regressive tax I’ve heard of in western Europe. Absolutely excessive and I’m sorry it’s happening to you.
Belgium has a home value tax as well, based on fictional rental income + a very convoluted calculation + different % surcharges per council. I find back that it’s on average about 700 to 800 euros per Flemish adult person, but it has large variations. It causes a lot of grumbling, but for most people it’s not considered excessive.
Taxing liquid capital is fairly straightforward, especially if it’s tied to income (like company founders owning shares).
Taxing non-liquid assets is complicated because it’s hard to make it fair in cases of family home inheritance and similar situations.
But taxing use of assets as collateral for loans (to create liquidity from a non-liquid asset) should be reasonably fair, it can be treated as an advance on capital gains taxes on the collateralized asset.
But taxing use of assets as collateral for loans (to create liquidity from a non-liquid asset) should be reasonably fair, it can be treated as an advance on capital gains taxes on the collateralized asset.
If you try to take too many eggs out of 1 basket, the person carrying that basket is likely to try and run away. So it’s easier and less disruptive to take a few eggs out of lots of different baskets.
Taxing accumulated capital without exceptions is also guaranteed to screw people over. The man in the OP is a good example: he’s a modest man who many years ago bought a modest house for a modest sum of money. Due to circumstances, that house has now increased in value, making him a wealthy man on paper. But he’s deriving no income from that wealth, since he can’t rent it out because he lives in it himself. So now he’s a modest man, who is rich on paper, who is expected to pay high taxes on his paper wealth, turning him into a poor man who is barely scraping by.
And this is why in most civilized countries, progressive income taxes make up the majority of the government budget. Basing taxes on non income/investment related metrics screws over the poor + lower middle class. It’s a transfer of wealth from the poor to the rich.
This doesn’t fit the narrative, but a lot of American states have lower effective property tax rates than European nations. There exceptions on both ends of this of course (like TX which is making up for a lack of income taxes).
People should look them up and compare European nations to major us cities and states. Europe ends up with not only higher income taxes, but also higher property taxes overall. And a completely insane financing method like having adjustable rate mortgages being normal, locked only for a period of 3 to 5 years before basically being forced to refinance. Little wonder that property ownership rates are generally so far below american ownership rates.
No system is perfect and people with means tend to find every flaw in them (and plant those flaws if they are wealthy enough). But people really need to remember that the grass is always greener because of all the manure.
And that man clearly does not live in such a state, nor did I (or anyone else I think) claim that his circumstances apply to the entire usa. You’re wrong in assuming that other people are not aware that different places have varying laws and tax systems.
Your whataboutism defence of regressive tax systems is also very strange to me. That other places have unfair practices in place, is no excuse to put up with an unfair system in any one place. Call them all out on their brokeness, but if you do call them out, you’ll have to be more specific in your example(s), state things that are actually verifiable instead of some vague whataboutism.
Ps, while I did not think your whataboutism defence was relevant, this “Little wonder that property ownership rates are generally so far below american ownership rates.” was easy to verify and it turned out to be false. Home ownership rates are on average slightly higher in Europe than in the usa, here’s statistics: https://www.statista.com/statistics/246355/home-ownership-rate-in-europe/ https://fred.stlouisfed.org/series/RHORUSQ156N
you could have progressive taxes on wealth as well. there’s a difference between having one house worth 500k and having 500 million in shares
True, you just need to make sure you start high enough up, or exempt the value of a primary residence (maybe limit the exemption to a non-opulent value of a house so the richest don’t start building castles to bind their money tax free)
UK has property taxes too and its pretty shit tbh. Council tax, there are bands based on what your house was worth in the 90s (yes really…) and generally the poor will pay a higher % of their income. I have a pretty small bungalow, 60m². One of the lowest bands and pay £1600 a year on a house that cost £230k. The most you can have to pay is £4200, beyond that point regardless of how much more expensive your house is the tax rate doesn’t increase.
The original plan of the tax was a fixed rate per person. This among other things is why many people were keen on the idea of digging a hole so deep that we could hand Thatcher over to Satan personally.
That has to be the most regressive tax I’ve heard of in western Europe. Absolutely excessive and I’m sorry it’s happening to you.
Belgium has a home value tax as well, based on fictional rental income + a very convoluted calculation + different % surcharges per council. I find back that it’s on average about 700 to 800 euros per Flemish adult person, but it has large variations. It causes a lot of grumbling, but for most people it’s not considered excessive.
Why have taxes based on income when you can tax accumulated capital instead?
Taxing liquid capital is fairly straightforward, especially if it’s tied to income (like company founders owning shares).
Taxing non-liquid assets is complicated because it’s hard to make it fair in cases of family home inheritance and similar situations.
But taxing use of assets as collateral for loans (to create liquidity from a non-liquid asset) should be reasonably fair, it can be treated as an advance on capital gains taxes on the collateralized asset.
Just worth repeating
If you try to take too many eggs out of 1 basket, the person carrying that basket is likely to try and run away. So it’s easier and less disruptive to take a few eggs out of lots of different baskets.
Taxing accumulated capital without exceptions is also guaranteed to screw people over. The man in the OP is a good example: he’s a modest man who many years ago bought a modest house for a modest sum of money. Due to circumstances, that house has now increased in value, making him a wealthy man on paper. But he’s deriving no income from that wealth, since he can’t rent it out because he lives in it himself. So now he’s a modest man, who is rich on paper, who is expected to pay high taxes on his paper wealth, turning him into a poor man who is barely scraping by.