I think the rationale is that if you have unrealized gains, there is a high likelihood that you are well off, and can therefore be pressured into reifying your economic potential into a resource that the government can appropriate (ie money)

It’s not a straightforward tax like income tax, it’s more of a class based tax that has some aspects in common with income / CG taxes.

It makes sense when you consider that the capital owning class is and was always the most well off, even more so than aristocrats, since the Industrial Revolution anyway.

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slowmovintarget 7 months ago | parent | next [-]

It makes zero sense when you consider that the stock market is how most people save for retirement.

What you're saying is people aren't allowed to save for retirement, and you have to tax them every step of the way, destroying that savings because they might be well off due to owning stocks. That's not reasonable.

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mikrl 7 months ago | parent [-]

In Canada we have two types of nonstandard tax accounts, an RRSP and a TFSA.

The RRSP is what I think is called a 401K in the USA: you put money in pre-tax and pay income tax when you liquidate/withdraw in the future.

The TFSA you put post-tax money into and pay no tax to withdraw, including CGT, though there is a maximum capacity.

I would imagine if this tax came to Canada, RRSPs and TFSAs would be exempt from it.

My brokerage lets me open RRSP, TFSA and a standard cash/chequing to buy securities, but CGT only applies to the cash account which I don’t use as I haven’t maxed out the others. If I was maxing out the others, I’d have enough slack to do the financial dance, at least in the governments eyes…

	▲	slowmovintarget 7 months ago \| parent [-]
		In the U.S. those are 401K and a Roth IRA. Both have contribution limits low enough to make them not enough to retire on. Did the lawmakers in Norway make such exceptions and adjust for this? Or are they just trying to keep people dependent? Why should we trust Canada or the U.S. to be any better if they tried to put this sort of law in place? There would be loopholes for the very rich (which includes the political class), and everyone else that didn't have the "capital" to leave would be screwed. If you really want to fix things, tax capital gains from financial instruments (stocks, bonds, options, and all the ridiculous leveraged instruments on top) as regular income, and tax loans taken against such securities. At the same time, tax owned but unoccupied buildings and land, and restrict foreign ownership of real estate (you need disincentives for rent-seeking behavior and land as investment). So you can still invest to your heart's content, but there's not a perverse incentive to hoard or leverage. If you can make more by building something do that. But, but, but... those rich people! Stop worrying about people being rich, and stop trying to hand the government ways to confiscate, because every new method for confiscation gets enshrined in perpetuity. Having them crossing this line into imagining what you maybe, perhaps, could have gained in some alternate reality where you took some action, and taxing you based on something that didn't happen is bananas.

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thrw42A8N 7 months ago | parent | prev [-]

What a nice way to preserve feudal classes. It'd be just terrible if someone not rich attempted startups.

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vidarh 7 months ago | parent | next [-]

Having started companies in Norway without being rich at the time, it's not generally remotely a problem. The wealth tax is low, and it only kicks in over a threshold. If you can't afford to have your company pay you enough or lend you money to cover the wealth tax at the point where it starts to become a challenge, then your company is likely a shitty investment.

There can be extreme corner cases where it's a challenge, but it's extremely rare.

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mikrl 7 months ago | parent | prev [-]

I don’t support these kinds of taxes but I think that is also a little hyperbolic.

Poll taxes, and even flat taxes can also be seen as unjust taxes on ‘money you do not have’ when you subtract the cost of life from someone’s income.

This one is novel in the modern era because it only substantially negatively affects capital owners, rather than wage / fixed income earners.

As both capital owner and wage worker though, I just see it as yet another potential headwind… and yes, there are class dynamics at play that go beyond the economy and up into political power and the state.

	▲	thrw42A8N 7 months ago \| parent [-]
		No, it substantially negatively affects people who don't have any capital. People who do can deal with it.