Yet more rich peeps say \”tax me, tax me!\”.
\”I would say to Merkel that the answer to sorting out Germany\’s financial problems, our public debt, is not to bring in cuts, which will disproportionately hit poorer people, but to tax the wealthy more,\” said Lehmkuhl. \”We are always hearing about savings packages, but never tax rises. Yet tax increases are a way out of this mess. That\’s where the money is: rich people.
\”Something needs to be done to stop the gap between rich and poor getting even bigger.\”
Under his group\’s plans, the new tax would only affect individuals with more than €500,000 in capital wealth. All money over that ceiling would initially be taxed at 5% for the first two years and thereafter at 1% or more.
Last week in France Nicolas Sarkozy proposed a similar idea: a temporary tax on the very rich. This would arrive in the form of an \”exceptional contribution\” of 3% on taxable earnings for those earning above €500,000. It will probably only last until 2013.
I\’ve rather revised my opinion of the French one: looks like a clever piece of public relations more than anything else. It raises the top French tax rate to 44% on incomes over £500,000 a year or so. Offer and have accepted a very small, even trivial, rise so as to head off a possibly larger one.
The German idea is insane though. Wealth taxes are a very bad idea: where does the money come from to make new equity investments if not from wealth? And are we really sure that making rich people liquidate 10% of their portfolio over the next two years is a good idea? The BMW owning family must sell 10% of their shareholding?
Oh, and do note who is pushing that German tax:
\”None of us are in Buffett\’s or Bettencourt\’s league,\” said the founder, Dieter Lehmkuhl, a retired doctor with assets of €1.5m (£1.3m). \”We\’re a broad church – teachers, doctors, entrepreneurs. Most of our wealth is inherited. But we have more money than we need.\”
The upper middle classes are insisting that those above them should pay a lot more tax.