Reply #6: Love your post, I think it would be innovative [View All]

to have an income tax RATE determined by your wealth.

So your wealth is not taxed, but it does determine your tax rate.

Obviously, the wealthiest would have a high tax rate, and vice versa.

The rationale is as follows: Your taxes are high only if you are rich. People who have one good year are not unduly punished. Also, the rich will have less incentive to reap more money because it will all be taxed, but the poorest will keep all of their income.

In general, this would have the effect of capping the wealth growth of rich while putting upward pressure on the poorest. Moroever, people's tax rates will not vary greatly from year to year. It becomes more predictable.

If you think about it, it really is the way to go...which is why it will never happen ;-)