Bill Jamieson (Perspective, 26 March) points out some problems with a wealth tax as a measure to reduce inequality. But Switzerland has a wealth tax and everybody loves it.
The poor love it because it pays for the good infrastructure, second to none, which all Swiss enjoy.
The upwardly mobile love it because it reduces income tax and other taxes at a time when they are struggling to build up their businesses and start a family.
The government loves it because it is stable. Other taxes can go up and down a lot depending on the economic situation, but the wealth tax is very steady.
Even the rich love it because it helped them on the way up. They prefer it to inheritance tax, which breaks up family businesses, breaks up estates, and causes them to be sold, often to foreigners.
In fact, wealth tax can be considered a pay-as-you-go inheritance tax; 1.5 per cent over 40 years is equivalent to 60 per cent inheritance tax but is a lot less traumatic.
Does a wealth tax discourage the Swiss and drive them abroad? Let me end with a quote: “The average Swiss adult is worth a world-beating $513,000 (CHF467,000), seeing off competition from Australia, Norway and Luxembourg”, according to the 2013 Credit Suisse Wealth Report.
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