In today’s WSJ, Stanford economics professor Ronald McKinnon makes what he calls a “conservative” case for a wealth tax (the emphasis is mine):
In order to have a fairer tax system, we should implement a new federal wealth tax in addition to the federal income tax. Unlike the current income tax, the wealth tax would not rely on how income is defined. Rather, it would require that households list all their domestic and foreign assets on, say, Dec. 31 in the relevant tax year. With a large exemption of $3 million that effectively excludes more than 95% of the population, a moderate flat tax—say 3%, on wealth so defined—could then be imposed. …
If requiring taxpayers to provide to the federal government a complete list of their assets is conservative, I am going to need to revisit the definition.¹
I usually don’t like slippery slope arguments, but in this case I must make an exception. The taxation of static wealth based on what a cabal of bureaucratic elites thinks is the right amount of wealth a person should be permitted to have is like the first snowball in an avalanche. Just how long do you think it will it take before the left proposes an increase in the wealth tax rate? And when Republicans oppose that increase, how long do you think it will take for the left to demogogue the issue, and, once again, accuse the right of favoring the rich at the expense of the middle class?
As conservatives, when we concede to any tax that is based solely on a taxpayer’s economic class, regardless of how low the rate appears to be, we lower the bar progressives must hurdle in order to engage in future, steeper confiscations of wealth.
A tax on wealth is not wrong because the wealthy can’t afford to pay it. It’s wrong because it’s anti-freedom and anti-American.
¹ Of course, none of this really matters because the left will rightly attack the wealth tax on right to privacy grounds. And if you believe that, I have citrus grove in Iceland I want to sell you.
(Hat Tip: Paul Caron)