I would argue that there should not be a tax on income at all but rather a tax on net wealth. A tax on income is paid first before the expenses of living. A tax on net wealth is paid last after the individual has paid for everything else.

A tax of approximately 2.5% of net wealth/year would generate more tax revenue than the income tax does today and it would treat every person equally without brackets.

For people with high assets and low income the annual tax payment would be capped at 40% of income above some floor with the unpaid balance of the tax becoming a lien on the taxpayer’s assets with interest at the T-Bill rate and the tax payable when the assets were sold or at the taxpayer’s death.

I laid out the details in a column but Medium’s rules prohibit me from including a link in a comment.

— David Grace

Graduate of Stanford University & U.C. Berkeley Law School. Author of 17 novels and over 200 Medium columns on Economics, Politics, Law, Humor & Satire.

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