provoost on Nostr: This proposed law replaces the existing one, there's really no ambiguity about that. ...
This proposed law replaces the existing one, there's really no ambiguity about that.
In the current system you're taxed on a fictitious return on investment (e.g. a 30% tax on an assumed 4% return on investment gives you a 1.2% "net worth tax")
In the new system you're taxed on the "real" return, which includes paper gains. That's mainly a problem because you have to rapidly liquidate assets as they go up in value. While on the way down the government just gives you a voucher against to future taxes. For a limited time. And can't be used to offset income tax.
In the current system you're taxed on a fictitious return on investment (e.g. a 30% tax on an assumed 4% return on investment gives you a 1.2% "net worth tax")
In the new system you're taxed on the "real" return, which includes paper gains. That's mainly a problem because you have to rapidly liquidate assets as they go up in value. While on the way down the government just gives you a voucher against to future taxes. For a limited time. And can't be used to offset income tax.