alt Hacker NewsI think that is the glaring hole here - via an insane number of instruments from the various investments, they can reduce their tax liability (fed and state) to be very close to 0%. I believe a main idea of the wealth tax is to get around the insanely complicated tax code w/ all its loopholes.
A national sales tax also gets around the insanely complicated tax code without government confiscation of wealth. Regardless of how it is earned money eventually gets spent. Rich people spend far more than lower incomes so they pay more taxes. If they pass their wealth on it will still eventually get spent by somebody. That fixes the stepped basis problem of inheritance. If they use equity to get loans they are still spending money so it fixes that problem too. It is also easier and less costly to collect and enforce. No special forms for specific types of income to make sure you are getting taxed enough and no army of IRS agents to check that everybody is following the tax code.
The most common opposition to replacing income tax with a sales tax is saying it is regressive because "poor" people will need to spend a larger portion of their income on taxes than a wealthy person. Ok, so don't food or primary residence. A poor person isn't buying a $300,000 car or a second home. The best part is that if somebody is having a hard time getting by, every dollar they earn can be saved instead of giving Uncle Sam a short term loan until tax day.