3% sounds high but I don't get the objection - is the idea that he would cease to be CEO because he loses his shares? If Bezos is the best CEO can't he stay on because others shareholders will vote him in? As for liquidity he can hand over 3% of his equity to the IRS directly?
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Replying to @robertwiblin @webdevMason
Liquidity may be a bigger problem for other assets, but can't the IRS just take 3% of the the thing on paper, and collect the $ whenever it's sold? I feel like some creativity to accommodate this new kind of tax should be able to make it practical in most cases.
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Replying to @robertwiblin @webdevMason
I can well believe that wealth taxes have bad incentive effects, as do other taxes on capital and labour income, but haven't heard a clear argument that they're worse than the alternatives, at appropriately low rates.
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Replying to @robertwiblin
Bezos can keep his job & still find himself newly beholden to more conservative interests with less personal skin in the game. I think this matters — where would SpaceX be? If you're not taking the tax until a sale, it's just a worse capital gains tax that disincentivizes risk.
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Replying to @webdevMason @robertwiblin
Mason 🏃♂️ ✂️ Retweeted
Long run, this would kill innovative venture in the US. *Maybe* you can trap some extant capital here by threatening to confiscate a huge % of it on exit, but who wants to sign up to gradually lose their own successful business in advance? RIP, this chart https://twitter.com/sknthla/status/1070031703421333504 …
Mason 🏃♂️ ✂️ added,
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Replying to @webdevMason
I definitely worry about capital flight under a wealth tax. That's why Piketty argued it had to be done cooperatively with other countries. USA does already tax capital on exit though (when people give up citizenship).
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Replying to @robertwiblin @webdevMason
We need to change the nexus of taxation to make it harder for the rich to avoid being appropriate taxation in a more mobile world IMO. But that's a broad issue beyond just a wealth tax.
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Replying to @robertwiblin
1/5 of Fortune 500 companies were founded by first-generation immigrants. If I'm a would-be entrepreneur watching founders in the US caught between a tax designed to actually lower their net worths & all-out confiscation at the border, am I going to step in the bear trap next?
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Replying to @webdevMason @robertwiblin
Note: current exit tax is 23.8% *on capital gains*. If I had $1B in stock today that had doubled in value since I acquired it, I'd owe $119M. To keep the wealthy from fleeing, Warren is proposing a 40% tax on ALL wealth over $50M. Under that scheme, I'd owe $380M — more than 3x.
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Replying to @webdevMason @robertwiblin
Is a tax that only kicks in above $50m a meaningful disincentive for "would-be entrepreneurs"?
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Replying to @JustJoshinYou13 @robertwiblin
The ones actually likely to start businesses worth >$50M? Yeah. The median early-stage valuation is $30M. If you're coming to the US to access capital in any serious way, that kind of number is not crazy high.
11:24 AM - 30 Jan 2019
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