Oh goodness, so its the end of the world, all entrepreneurs will leave the US and go elsewhere, we are all doomed, the world ends. All the wealthy will go bankrupt. This is the same mantra that is echoed in the halls of Washington DC every single time by satanic lobbyists. May God help us, we will all become Venezuela. LOL. Let those who abused the system and created loopholes for themselves PAY THEIR FAIR SHARE for God's sake. I believe they specified the tax on unrealized gains is on liquid assets, so probably houses, publicly traded stocks.[/QUOTE]
The tax structure needs revision. We don't have enough information about the new proposal yet to properly evaluate it, but it would seem there may a much better way to go about revision than what the administration is proposing, which it seems may be a form of MTM accounting for those in certain income categories. If so, I am against it on the grounds I don't like introducing any more complexity into our tax code. It is too complex as it is. There must be more to this new proposal than meets the eye. I have thought for some time that more brackets are needed up to 50% at least, and possibly higher -- this has to be determined by putting pencil to paper and not by guessing. What this would do is restore much of the pre-1981 progressiveness that has disappeared from the tax structure and resulted in acceleration of the effect of return on capital exceeding the economic growth rate. The result of our post 1981 tax bracketing and inheritance rules has been a lessening of opportunity among the lower economic classes and a piling up of capital resources at the top end of the economic ladder. Revisions to the stepped-up-basis rules for inheritance may be a better, less disruptive and fair way to tax unrealized appreciation. The long range goal over the current century should be to reverse the affect of accelerated lopsidedness in wealth distribution while reducing, but not eliminating, the inevitable effect of the mean returns on capital exceeding the mean growth in GDP. The goal should be to ameliorate the harmful long term effects of what is now a constantly accelerating wealth disparity leading to an increasing loss of opportunity for economic advancement among the lower economic classes, and ultimately to a failed economy, and destructive social and political instability. A long-range problem that has existed for many years will require a correspondingly long time to rectify. The best time to start rectifying it is now; not tomorrow.
You'll never see a flat tax here in the US. Same with term limits. It would require politicians to give up too much power. Can't compare US to Japan or even Germany or Switzerland. That's the problem. Americans are in poor health. Japanese people overall have high longevity and tend to eat healthy. Only issue they have is smoking where they are a few percentage worse than Americans. Doesn't matter how good the health care system is, if people don't care about their own health, you'll get poor results. https://observatoireprevention.org/...have-the-highest-life-expectancy-in-the-world
I don't think a tax on appreciated assets could work. It's easy to calculate the value of stocks, but what about other appreciated assets such as land or art or collectibles. However, the fact that mega-rich guys like Jeff Bezos who has paid zero federal taxes for years should be addressed. Bezos has even twice filed for an Earned Income Tax Credit intended for low income filers, because his stated "income" was so low. They guys finance their lifestyles by borrowing against their appreciated assets, and even get a deduction on the interest they pay on these loans. This is a slap in the face to those of us who are paying their share of the government for them. I think the solution is to tax loans against appreciated assets as if it was regular income.
So how are those borrowed funds, used for consumption/lifestyle, repaid in its current form? At some point they need to cash in some of their options such as Elon Musk has done. That is when the tax man should be ringing the door bell.
The loan is not repaid in their lifetimes. After the billionaire dies, some stock is sold to repay the loan. Why do you think billionaires spend so much money trying to influence politicians to get rid of estate taxes? Elon Musk had to sell stock in order to purchase vested options, not because he needed money to live on.
So, as said those are the real issues. It's not the current tax rates. It's that there is no taxable income/capital. It should not matter when the loan is repaid,whether the guy died or not. The second the loan is repaid the tax should be charged,regardless of whether it will be paid, cash flow wise, by an heir or an estate. There should not he any estate tax whatsoever. The moment the guy passes any wealth that is passed on gets taxed. Donations or philanthropy should be allowed tax free up to a few hundred dollars. Problem solved. What you said about Musk is only partially correct. He did not have to pay taxes when the options vested. He had to pay on the exercising of the options to convert them to stocks. And he sold stocks to pay the tax bill.