I don’t mind paying my fair share of taxes. I believe it’s my civic responsibility to help fund the roads and bridges, the police and firemen, disaster relief, public health, safety nets, parks, environmental protections, scientific research, national defense, childcare and public education. The problem is that the tax dollars collected for each of these things are either misallocated or misaligned to our actual needs or they are grossly underfunded. We’re in this chronic predicament of lack and fiscal deficits because we keep electing government representatives who don’t listen to us and because we repeatedly fail to collect adequate funds. I believe I pay enough in taxes. My children who all earn higher incomes are paying a lot in taxes. In fact, the top 10% of high-income earners pay 40% of taxes. The problem is that the super wealthy who report little to no “salary income” currently pay next to nothing in income taxes. This is not right!
Our government allows the ultra-wealthy and CEOs who inherit or who take their compensation in company stock (instead of a salary) to avoid paying income taxes. These folks use their assets as collateral to borrow money from banks and private lenders at extremely low interest rates (2-5%) for their living expenses, thereby avoiding federal and state income tax. In addition, our federal government taxes long term capital gains at only 15% when they sell off stocks or property that have appreciated. This is “labor-free” money that really should be taxed higher than wages if the system were equitable. And finally, the wealthy pass on their wealth tax-free to their children. Again, the folks paying the most in federal income tax are high wage earners and small business owners. This isn’t fair and it is clear to anyone paying attention that the ultra-wealthy are not contributing their fair share to society.
Some politicians and many citizens are calling for a wealth tax to be imposed on the wealthiest folks who avoid taking a salary, pay less in capital gains, and pass on wealth untaxed, and thereby avoid paying income taxes. It would be helpful if we closed their ability to use stocks and other assets as bank loan collateral or if we taxed the loans themselves as income when it is evident that the loans are a substitute for salary income. As mentioned before, there is no logical reason why capital gains beyond a certain amount should not be taxed higher than wage income. The problem with the wealth tax is that it is too messy with all the appraisals required. In addition, the wealthy will simply hide assets. It will be too cumbersome to try to figure out how much any particular person is worth.
Instead, on the national level, I think we should tax the wealthy on capital gains at a slightly higher rate than wage income with an exemption amount to protect the middle class and as a guard against inflation. I believe we should tax any transfer of assets as income for the recipient beyond a predetermined level, and I believe loans secured by investments and assets other than one’s primary residence or business should be taxed as wage income. In addition, I believe the federal government should impose a 10% luxury tax above state sale taxes on extreme luxury items like original artwork, expensive jewelry, designer clothing, designer watches, private jets, yachts, perfumes, personal robots and luxury cars. Using a private plane should also come at an extra cost. I think the federal government should impose a hefty environmental surcharge every time a private plane takes off or lands in the United States.
More specifically, I think the capital gains on the sale of homes should be taxed as regular income for homes sold above $2 million while also eliminating the capital gains for home sales below that level. Large real estate investors who purchase property to rent should pay the federal government an annual surtax per rental (regardless of occupation) in addition to their state’s annual property tax.
And finally, with the move toward AI replacing human workers, I propose a $50,000 minimum federal annual tax per AI agent or robot used to replace the work of each human being. States should also impose an appropriate level of employment tax on the use of AI agents and robots. These funds should go towards the universal basic income needed to keep people afloat when jobs become scarce.
Taxing the wealthy is something we absolutely must do. Electing representatives who allocate our tax dollars according to our values must become a top priority in every election moving forward or nothing will change. It was clearly a fiscal mistake to allow DOGE to reduce the number of IRS agents, allowing the ultra-rich to avoid paying taxes with impunity. And I am hopeful that the courts will stop Trump from exempting him, his businesses and his family from any future tax scrutiny because we already know he cheats. Just as important, I hope the courts stop this misallocation of $1.776 billion of our tax dollars from going to Trump’s favorite criminals as payment for being prosecuted for their criminal actions done on his behalf.