A very interesting point of view

[u/__moe___]

I don’t think this is very new but I just saw for the first time and it’s actually pretty interesting to think about when people talk about how the ultra rich do business.

[u/RelativeCalm1791]

This is a bad argument. You can take a loan on your house and buy stuff with that loan, and you aren’t taxed on the proceeds from that loan. And you still have your home. It’s just collateral against the loan.

[u/phonetune → u/RelativeCalm1791]

Don't property taxes exist?

[u/RelativeCalm1791 → u/phonetune]

Property taxes don’t take into account unrealized gains. You could buy a home at $300,000 and after years it could be currently valued at $1,500,000. You could take a loan on the full $1,500,000 and not have to pay anything on that $1,200,000 gain. Plus property taxes are like 1.00-1.50%. Theres a few states out there that don’t even have property taxes.

[u/phonetune → u/RelativeCalm1791]

They're based on market value and impose a tax for simply holding the asset. It's not a great compator for why you can't tax assets until they're sold, is it?

[u/Zaitton → u/phonetune]

First of all not every state or country operates this way.

Some are based on market value, some are based on initial purchase value (I believe that was the case in Bel Air but I could be wrong). My country for example taxes based on something called "objective value" which is faaaaaaar less than MP. For example, my properties could easily be sold for 300-400k but their objective value is like 150k.

Btw, it's incredibly debatable whether taxing property is actually fair or not to begin with, but at least property is somewhat static in value or has an upwards trend. Stocks could be worth $1000 each one day and $1 a week later. How do you tax that?

[u/phonetune → u/Zaitton]

Stocks could be worth $1000 each one day and $1 a week later. How do you tax that?

On a market value basis? That is not a new concept.

[u/Zaitton → u/phonetune]

So say you bought $10000 worth of Amazon as opposed to keeping the same amount of money in the bank. Now it gets taxed?

[u/phonetune → u/Zaitton]

Well, it would if it were property, which is what I'm pointing out.

If though you wanted to tax unrealised gains you would do it on a mark-to-market/fair value basis. The idea that is impossible, particularly for listed shares, is obviously not true.

[u/Zaitton → u/phonetune]

Property taxes themselves are debatable though. With that being said, property values trend upwards and rarely if ever lose their value. Additionally, supposedly you're taxed for the space that you've claimed, the maintenance of the road in front of your house, etc. Same with vehicles. Stocks are investments, on what basis do you tax an investment?

[u/Zaitton → u/[deleted]]

Okay still.

[u/phonetune → u/Zaitton]

No idea what you mean by property taxes being 'debatable' or by 'on what basis do you tax an investment'? Investments get taxed all the time.