'Balanced Wealth Tax' - A solution to inflation!
Taxes that are imposed as a percentage of our net wealth is a well-accepted practice. You would pay a lower tax rate with lower net wealth and a higher tax rate with higher net wealth. Though many countries are facing challenges to implement it. Especially, in most of the so-called underdeveloped countries, there's no boundary of paying taxes on the basis of wealth. And so as, there's a high chance to getting rid of paying tax by the weather.
If we look closely, we will see that the people affected by recent global inflation are those who should pay fewer taxes according to their assets minus their liabilities. The unfortunate thing is, this is not happening and impacting negatively on how much they make at the end of the day.
In simple words, if we fail to impose a balanced wealth tax it will make the middle class and lower class pay more and get less at the end of the day.
Personal property, collectibles, and real estate should be included in the tax return, whereas we mostly depend on income tax. This is making the whole economy unbalanced because it's easier for the wealthy to get rid of paying more. On the other hand, if we are paying income tax in a similar percentage to the rich, then it's highly unlikely that we would make any fortune in terms of financial freedom.
However, it's true that the wealthier have a huge contribution to the economy through investment. But this also brings the chance to engage in tax evasion. Underdeveloped countries might, for example, move their assets to another country that does not levy this tax. Also, they hold business assets so they can manipulate the economy.
We all know that it's difficult for any government to do so but it's high time we should think about it. If I say from my personal experience, then I have to approve it's getting harder for us to pay tax returns every year against our income. It would be more justified if we could pay according to a balanced wealth tax.
Moreover, fighting against inflation is a tough job. The global economy is facing the worst case right now. So authorities need to look for every solution we have. Unfortunately, they are serving the wealthier for their own benefit rather than looking for a solution that can serve everyone.
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