Wealth tax (2 Viewers)

Sathius005 · Nov 11, 2013

Do you support a wealth tax?
Wealth taxes the way to go: IMF.
Source: AFR.

Should advanced countries implement wealth taxes as a means of stabilising and reducing public debt over the medium term? The normally conservative International Monetary Fund (IMF) has given the idea surprising emphatic support. The IMF calculates a one time 10 per cent wealth levy, if introduced quickly and unexpectedly, could return many European countries to pre- crisis public debt/ GDP ratios. It is an interesting idea. The moral case for a wealth tax is more compelling than usual today, with unemp't still at recession levels, with deep economic inequality straining social norms.

And if it were really possible would be temporary, such a tax would in principle, be much less distortionary than imposing higher marginal tax rates on income. Unfortunately, while a wealth tax may be a sound way to help a country dig out of deep fiscal pit, it is hardly a panacea. Still the IMF is right- on the grounds of fairness and efficiency- to raise the idea of temporary wealth tax in advanced countries to relieve fiscal distress.

And if it were really possible would be temporary, such a tax would in principle, be much less distortionary than imposing higher marginal tax rates on income. Unfortunately, while a wealth tax may be a sound way to help a country dig out of deep fiscal pit , it is hardly a panacea. Still the IMF is right- on the grounds of fairness and efficiency- to raise the idea of temporary wealt tax in advanced countries to relieve fiscal distress.

anomalousdecay · Nov 11, 2013

Re: Do you support a wealth tax?

I would say it depends on the type of tax imposed.

I think that there should be more regressive taxation, but only to a certain extent.

The problem with wealth taxes is that some people who work very hard and get a lot of money, and this is distributed as income to bludgers on the dole and those who will not use the money wisely to inject back into the economy.

However, to be a regressive tax, it should not be discriminatory.

This dilemma is the reason why not many nations have employed a wealth tax in their economy's.

OzKo · Nov 11, 2013

Re: Do you support a wealth tax?

http://www.imf.org/external/np/sec/pr/2013/pr13427.htm

Sathius005 · Nov 11, 2013

Re: Do you support a wealth tax?

What about redistributing income to old aged penisoners who have contributed so much to this country, they built this nation and deserve a secure pension. What about carers and those suffering from a disability. I think now is the time to increase the pension with the proceeds of a wealth tax. Income inequality is growing at dangerous levels and pensioners are becoming homeless. Do you think that this is acceptable?

Sathius005 · Nov 11, 2013

Re: Do you support a wealth tax?

Taxing times
Source: IMF

Persistently high debt ratios in advanced economies and emerging fragilities in the developing world cast clouds on the global fiscal landscape. In advanced economies, with narrowing budget deficits, the average public debt ratio is expected to stabilize in 2013–14—but it will be at a historic peak. At the same time, fiscal vulnerabilities are on the rise in emerging market economies and low-income countries—on the back, in emerging market economies, of heightened financial volatility and downward revisions to potential growth, and in low-income countries, of possible shortfalls in commodity prices and aid. Strengthening fiscal balances and buttressing confidence thus remain at the top of the policy agenda. Against that backdrop, this issue explores whether and how tax reform can help strengthen public finances. Taxation is always a sensitive topic and is now more than ever at the center of policy debates around the world. Can countries tax more, better, more fairly? Results reported in this issue show that the scope to raise more revenue is limited in many advanced economies and, where tax ratios are already high, the bulk of the necessary adjustment will have to fall on spending. In emerging market economies and low-income countries, where the potential for raising revenue is often substantial, improving compliance remains a central challenge.

anomalousdecay · Nov 11, 2013