This past week, the Billionaire Tax Now coalition sent Governor Newsom a letter offering to cut a deal: they’ll pull the 5 percent wealth tax from the November ballot if he backs a 2 percent rate instead.
Zucman comes up with 2% by saying a 33% tax on an estimated 6% annual capital appreciation is a good place to start; the key point, as Zucman acknowledges and you emphasize, is not the 2% number but the acceptance of a starting point. The California tax advocates probably should have started there, or even lower, since their long-run objective is changing the state constitution so the legislature can increase the number at will later on. This is the same reason Sen. Warren often says "it's only two cents" (i.e., 2%).
Most people know the Federal income tax started out this way, too. A better example might be the Alternative Minimum Tax (AMT), introduced in 1969 targeting 155 high-income households. By 2017, before the Tax Cuts and Jobs Act cut the AMT way back, it covered 5.2 million households.
It's not the number. It's never the number. It's the acceptance of the concept as a starting point.
Thank you for this article. I was under the mistaken impression that the amendment was for sure going to be on the ballot in its present form. I had no idea the the bizarre California process would allow late changes due to renegotiation with the Sponsor. Of the dozens of articles I've read about the matter, this was the first time I encountered this key piece of information and context. Mass Journalism just ain't what it used to be.
Thank you for reading and commenting. Yes, we try to pick up angles that we think are underemphasized out there, and also where we can add some extra insights with data and analytics. That’s the goal at least!
Zucman comes up with 2% by saying a 33% tax on an estimated 6% annual capital appreciation is a good place to start; the key point, as Zucman acknowledges and you emphasize, is not the 2% number but the acceptance of a starting point. The California tax advocates probably should have started there, or even lower, since their long-run objective is changing the state constitution so the legislature can increase the number at will later on. This is the same reason Sen. Warren often says "it's only two cents" (i.e., 2%).
Most people know the Federal income tax started out this way, too. A better example might be the Alternative Minimum Tax (AMT), introduced in 1969 targeting 155 high-income households. By 2017, before the Tax Cuts and Jobs Act cut the AMT way back, it covered 5.2 million households.
It's not the number. It's never the number. It's the acceptance of the concept as a starting point.
Exactly right, and why the proponents of the wealth tax have shown they don’t care about the number.
Thank you for this article. I was under the mistaken impression that the amendment was for sure going to be on the ballot in its present form. I had no idea the the bizarre California process would allow late changes due to renegotiation with the Sponsor. Of the dozens of articles I've read about the matter, this was the first time I encountered this key piece of information and context. Mass Journalism just ain't what it used to be.
Thank you for reading and commenting. Yes, we try to pick up angles that we think are underemphasized out there, and also where we can add some extra insights with data and analytics. That’s the goal at least!