What is wealth tax?
wealth tax is a tax that is collected from the wealth held by a person or entity. The tax rate is usually the percentage of the net assets of the taxpayer, but may vary depending on the total net assets and the specific laws of the tax nation. Several countries use this form of taxation to raise funds for the government, although there are certainly arguments for and against this approach.
Clean assets
Most wealth taxes around the world are based on net assets, which are usually found in total with the total assets of the taxpayer and then deducting debts such as loans and mortgages. Assets include cash deposits, real estate, investments, trusts and shares in companies. Given that wealth taxes mean that the richest taxpayers in the country must pay a relatively higher amount of taxes than their poorer counterparts, it is considered a type of progressive tax.
Variations
In some areas of the world, a mixture of rich can be foundHe knows and taxes from income. In United, taxpayers pay taxes rather than federal wealth taxes; However, they may also be subject to other types of taxation, such as real estate taxes, which are taxes of the value of the property, the type of wealth. As the revenue of real estate tax in many areas shows, wealth tax can be a very effective way to raise money, because people who hold valuable investments in real estate can owe considerable real estate taxes annually.
advantages
Some economists have suggested that there are certain benefits of wealth taxes. These benefits are usually related to the differences between income and wealth. While almost all people earn some kind of income, most of the real wealth in the country is often held by a relatively small fraction of the population. Income taxes that are based on the above -mentioned income that someone earns a year is sometimes strongly criticized as an interferenceCenter and lobes of classes are harder because it depends more on this income. However, individuals with high wealth earn in proportion to less income, and therefore tend to pay less income taxes. Instead, wealth tax would be more tax burden on those who have a higher total net fortune.
The wealth and power of the Association tend to be focused on the hands of a very small elite, these critics say. In some nations, this concentration of power may be considered a threat to democracy. The focus on collecting taxes on this small group with the greatest wealth could create more equality by reducing how much wealth is concentrated in such few hands, and at the same time raise a large amount of money for the government.
disadvantages
Critics of wealth tax suggest that defining exactly what is very difficult to tax the taxpayer's assets. In many cases, it is difficult to appreciate assets such as private enterprises and real estate, and may not always be appreciated by different evaluators. CalculaingButh DAC also usually requires more complicated administrative work and therefore costs more management.
wealth taxes can also be considered as sanctions collected on the rich and can act as discouraging to accumulate wealth and invest or wisely save. Income tax tax only once - when it is terrified - while claiming that tax tax tax on it the same value every tax year. Some suggest that wealth tax supports a capital flight from the nation, because wealthy individuals have strong motivation to move their assets to places without taxes.