To think the world should have a 100% tax rate

[notanothernamechange24]

On anyone with assets or income over 1 billion pounds. Nobody needs to hoard money / wealth to that degree. There is no justification for it.
The world would be a far better place without billionaires let alone trillionaires.

I know it will never happen. But it should. AIBU?

Well, what incentive would they have to build companies that employ hundreds or thousands of people in well paid positions
Yanbu to think no one needs billions but deprivation of assets is a daft idea in a capitalist society

Business can be owned by multiple people. It would restrict an individual owning more than 1 billion worth of shares in said company. It would encourage greater cooperatives. Arguably it would be in the interest of most businesses of that sort of size, to be owned and managed by more than one person

But income tax with a 100% rate for those with assets over £1bn would raise £0. Nobody would bother to earn anything as they would get nothing from it. Not better to let them earn the money and they 45% tax to support govt spending?

But they will continue to earn over that rate. The interest alone would be bringing in millions a year. When you have that level of wealth it just increases.

I mean most billionaires don’t pay tax anyway at anywhere near the rate of ordinary people. It’s all non dom and legal loopholes

I actually agree with you. I think one person owning more than the vast majority of countries is morally wrong and dangerous in terms of power. The top twelve billionaires own more than the bottom half of all humanity - more than 4 billion people.

No one needs that much money. I don't believe that their businesses bring more benefit to humanity than greater equality would. I think people struggle to envisage how much money a £ trillion is. If you spent £1million a day, it would take over 2700 YEARS to spend it all.

I don't believe that these people would stop work if they were taxed at 100% over 1 billion. They don't need to earn any money already, they could retire tomorrow and never spend it all. They must either be motivated by something else, or be hoarding money for the sake of it in which case it's doing no-one good.

and any one of those 12 could feed the entirety of the 300 odd million people who are starving in the world. They wouldn’t even notice the cost. It would be small change to them.

Agree

Have we all been watching Elon Musk by any chance…

Have you heard of this thing called the Laffer curve?

If you tax at 0% you will get zero tax, if you tax at 100% you will also get zero because why would anyone work/take risk in order to get nothing in return?

I always think this is a bit of a nonsense argument. Do you seriously think every entrepreneur is just going to give up in case they become billionaires?

Lots of people give their all to a business for reasons other than money. some noble reasons - others not.

A lot of it is mindset. A lot of these mega rich tycoons are actually quite emotionally stunted and would actively benefit from not chasing money and focusing elsewhere.

i think we should adopt the ancient Greek attitude to taxes- people actively sought to pay more tax because it brought kudos and status. We need people thinking like this rather than trying to hoard it

But that’s a nonsensical argument. These people will not suddenly stop earning money or gaining wealth at the point they hit 1 billion. Thats not how it works. The interest alone is massive.

And there is a huge argument that many of these enormous corporations are not healthy for the planet or humanity.

Already there are people who are not taking promotions because it would put them into a tax bracket which wouldn't benefit them at all so because they will stay longer in their postions other people trying to progress in their careers find themselves hitting against a brick wall. As trickle-down goes it hasn't got the best odds.

I mean there are many economists who would disagree with you op!

Maybe. But that is an entirely different situation.
If someone is turning down a promotion solely because of the tax implications it will most likely be because they will have a net loss overall. And that loss will have a negative impact on their lifestyle.
A billionaire is not going to have a loss to the extent that their lifestyle is compromised. These are people who have so much money they never have to think about money again. They couldn’t spend it all even if they tried.

Billionaire are passively earning more money every day than most will in a lifetime. How is that ok?

And many other who would agree!

there’s a very wide range of views among economists

People have always done this though.

people in this situation are looking at the extra work they have to do for a smaller increase than it first looks on paper - they aren’t getting less money. Just less than the overall figure suggests.

you could argue it clears the way for younger people- it’s worth it for them as it’s a couple of years working for relatively little extra, but gives them experience for the bigger jobs with huge money.

the people not going for them are people who are happy with their lot and don’t want added stress.

Don't conflate people making 90K with billionaires. It's not the same.

This is no way as near as simple as you think.

Billionaires would give wealth away to family etc if faced with a 100% tax rate on assets.

And wealth taxes are very complex and difficult to implement. We can barely manage it in an effective way for inheritance tax. Billionaires don’t just have a billion pounds sitting in a bank account making interest.

Let’s say you have a company worth £1bn. It goes up in value to £1.1bn. You need to pay £100m tax so sell some shares (as you’re unlikely to have the liquidity to just pay it). This in itself affects the markets. It affects the model you have to use for your company and generally taxes which limit the business model which has to be used are a bad idea.

The value of the shares then goes down again for whatever reason. But you already paid your tax. Can you get it back?

And how do you deal with this on an international basis (as almost all billionaires will be internationally mobile and have assets outside the UK). We don’t really have international wealth taxes in this way so there isn’t a framework for them. Do you want the UK to effectively confiscate foreign assets?

Oh believe me I know it would be virtually impossible to do. I’m more looking at it from a moral perspective than anything.

But you are taxing all income, right? Any savings interest is taxed as income, and is therefore subject to 100% too. If I had £1bn (big if unfortunately) and I know interest above £1bn would be taxed 100%, I would spend the amount needed per year (gin, etc) so that I had the amount in saving that would compound to £1bn, avoiding your tax. As a PP says, Laffer is your answer to this question (just Google).

So conclusion, you would raise a lot less in taxes that you do now, so that we are all poorer, fewer libraries, teachers, police etc. Kick the rich and we in fact kick ourselves. To me - this is a strong moral argument against your proposal.

ie would you do this on moral grounds… absolutely not.

There have always been highly successful people, who build companies and employ lots of us to work for them. There are a few lucky people who inherit family wealth. They should pay a fair tax, but your idea is crazy. We need more and more of these people. You will discourage growth and development.
I take it you resent extreme wealth.
we want more wealthy people, spending lots of money, growing businesses and developing new projects.

We already have an effective 100% tax rate in the UK for people earning >£100k with kids.

I take home £0 between £100-155k between tax, NI and loss of benefits.

You are on a hiding to nothing with this kind of argument unfortunately because people are now immune to the concept of what a billion pounds actually is.
The fact that a poster has already compared this idea to someone not wanting to move up an ordinary tax bracket just shows that.

Actually the idea is the sort of thing we need to look at but because we are so used to hearing about billionaires now (a thousand million!) we seem to think it's within anyone's reach and becoming a billionaire is some kind of incentive - so people say taxing billionaires in this way would demotivate people.
It's ludicrous because the majority of us will never see or make a billion but for some reason a lot of people think they will and are very protective of the idea of the uber wealthy.
In a lot of ways we have lost all perspective on wealth and it's hard to discuss things like this rationally.
It is disgusting that people like Musk exist.

You don’t work in finance do you @notanothernamechange24 ?

Are you trying to be patronising?

Are you going to do the "finance gaslighting" that people love to do where you say that being a multi billionaire is actually a really good thing for the world and we shouldn't question it if we haven't done a degree in economics or don't "work in finance"?

The way people, particularly on here, are about extreme wealth is so odd. Like it's almost sacrilegious to question the morality of people amassing more wealth than they can possibly ever hope to spend.