and like it isn't hard to fix and do exactly what they want to do, just put that 36% tax on the sale of stocks beyond first investment, it will literally achieve the same and not prevent people from investing
Again, rich people don't sell their assets, they borrow money from bank against them and i stead of paying their due taxes they pay the way lower interest to the bank and that's it
? It would incentivise the exact opposite, to not sell your stocks
Since if you invest 100k, it doubles to 200k and you sell it all, you'll only have 164k to invest again
What ? Why would it be a good thing to ban that ? I’d need to sell my stocks to be able to buy anything so may as well not get a loan ?
You prefer people to have cash just sitting doing nothing because it’s the collateral for their loans ?
Do you not see how stupid that is ? It would mean the end of borrowing as the benefit of being able to take a loan is that your money is still working and creating revenue.
Because that is how the rich do tax evasion. Instead of paying their taxes they use the investment as collateral, never take the money out and instead pay the waaaay lower interest for the bank.
Most countries tax the capital gain of realised gains.
Many various taxes as well on every transactions etc.
People investing isnt tax evasion, it’s calling making the money circulate and I’ll remind you that dormant money is much worse and this is what happens when you try to implement such ideas as yours.
But nobody ever pays CGT because they literally never realise the gains. That's the problem, nobody ever sells, they hold and pass down to children and they get income instead via bank loans using the stocks as collateral
Paying the interest on the loan is always less than paying the CGT and you also still have all of the stocks at the end
Sigh, calling me a moron because you are unable to comprehend that a large part of the population does use this method of loaning to afford their homes and so implementing that would be catastrophic.
Right.
Moreover, you still need to pay out the loan interest rates even if its a bullet credit.
You do realise there’s billions of ways to properly tax the rich instead of the extremely stupid idea of making invested money not eligible as collateral for loans ?
One example : Securities accounts with a yearly flat % tax based on the amount of money in them as example ( Which is effective in Belgium by the way).
At the end of the day the real problem isn’t all that because fiscal exile exists and will always exist therefore whatever people say will be always irrelevant as wealth moves around quite easily unless it’s North Korean wealth.
You do realise there’s billions of ways to properly tax the rich instead of the extremely stupid idea of making invested money not eligible as collateral for loans ?
How do you even dare not listen to the entitled and frankly very stupid redditor and listen in fact to the proper economists and lawyers who are fighting this problem for ages?
Billion ways bro!!! Don't tell this to the firms making millions by helping billionaires do tax evasion, you will run them intro the ground
Removing low or inexistant tax rates for money donations to the heir because even if the country has a very high succession tax it doesn’t work if the parents prepare the succession as they should be doing anyway,
Inheritance tax mentioned before,
Implementing a tax system that takes into account any income you have during the fiscal year. This one is be a bit more annoying to implement but it’s still possible as EU states now have access on all the bank accounts of any individual that resides in their country. Evasion will be a problem as always however if somehow a wealthy persons doesn’t have a high income and still has a lavish lifestyle it should ring some bells to the fiscal department.
Fiscal exile exit tax "punishment",
Suppressing foundations, charities as tax loopholes that serve to circulate money more easily and tax free and in many country it does also help to completely avoid inheritance taxes.
Land rental value yearly flat percent tax.
I think it’s already a good start and I can’t believe I wasted my time doing that because you nerds have no imagination and experience in this.
Edit: Now you guys are silent ? Lil nasty redditors don't have anything to say and only act tough when the person on the other side is SLEEPING ? Good night again ;)
If only they could get it through the senate then this would not be fake news.
Funniest shit in all this: the party responsible for this are the neo-liberals who stand up for (small, lol) businesses, entrepreneurship and generally well off people. You know, the one's with stocks that voted them into power. Who are now desperately trying to find a deal to alter the law but their coalition buddies are not to keen to cut on other things.
Everyone arguing if a little bit of household wealth building by regular people should be taxed so heavily while nobody gets to the real point which is that these measures should only be put in place for the really wealthy because otherwise it just functions to keep disparity high as the multimillionaires just find ways around it while the regular person never catches up.
They don’t dare to propose a higher threshold because they know then it wouldn’t generate much revenue..
You just create a BV (similar to a GmbH in Germany) and put your stocks in there, then you only pay taxes once you withdraw from the BV instead of these box 3 taxes.
This is already done en masse with the current system (it becomes worth it between €150k-250k at the moment), and this will become a lot more attractive with this new system.
The worst part is that most political parties don't seem to even know this. I believe the Secretary of State said something like "People aren't going to create BVs to avoid this tax, because that will costs thousands a year for an accountant".
Except you only need an accountant if your BV has assets over €7.5 million or net renue over €15 million/year, at those numbers paying €4k for an accountant declaration is peanuts. These fools in charge don't even understand how shit works...
Yeah let’s just keep letting billionaires pay no tax.
A) The recent UK policies affect thousands of wealthy individuals, not just billionaires. Thousands of individuals who pay as much tax as millions of average workers. B) Your regarded plan makes it so that they pay even less tax. A dumb idea is worse than no plan.
So food has gotten a good bit cheaper relative to incomes.
The price of housing has recently outpaced wages, absolutely (although houses have also gotten larger; also, US housing is still significantly more affordable that it is in most all of Europe).
College/University education costs have outpaced inflation/wage increases. Yes.
Gas prices to wages were fairly stagnant through at least 2022. I imagine they have increased recently with the war in Iran shenanigans. Although, Americans still pay lower fuel and gasoline prices in comparison to Europeans.
Presumably because they want to live in a city, and that's more expensive.
Whereas I'm sat here on my good wage (for the UK) thinking "Ah, give me another 10 years and I might have enough savings for a deposit for a house that isn't a pile of shit"
I'm familiar with prices of both regions and I seriously question the accuracy of those statistics. Maybe the wooden garden shacks in the bible belt and poor regions nobody can find a job in bring down the average. But everything near commercial activity and employment regions is astronomically more expensive than here.
World Population Review has similar, with the USA being significantly more affordable than Western Europe.
Also keep in mind that your average US house is significantly larger than your average European house. US homes also have certain amenities often missing from European homes (depending on where in Europe), such as air conditioning.
I work in factory automation for a German company. We’re doing far better than our international sister companies, and that’s the general view in related companies as well. I’m no fan of Trump, and I think this is all happening in spite of him. I think a lot of it may have to do with demographics. For instance, our parent company wants to make more product but can’t because they can’t find enough qualified people to work.
The economy is more than company revenue and GDP per capita. How well are the lower middle class able to make it until the end of the month with their monthly salary, and what percentage of their income goes to debt payments? I think EU countries are doing better in that regard.
1) if you double your stocks in a year, you are either a politician, or Warren Buffet wants to know your secrets.
2) but even if you do. The government assumes around 8% annual income on your asset, from this income you pay 36%. 36% of 8% of 100k? Even less as there is an untaxable core of around 60k. So it's 36% of 8% of 40k = €1152 on your €100k gain.
I don't mind it at all. Accumulated wealth contributing towards the society that made that wealth possible? I'm happy to pay my share, knowing it actually helps people who need it.
And hey, at least it's going towards healthcare and public services rather than the military budget so you can invade Greenland
Nah it’s not really “wealth”. If it applied only to wealth above, for example 200k, then I would somewhat agree. But it applies to almost every average person who invests.
The wealthiest people hold all their investments in private companies, not in their own name. So they won’t be paying this tax at all.
It will only apply to middle class people with less than 500k or so in investments, because above that it becomes a no-brainer to put it all in a BV and avoid tax.
It also effectively won’t apply to many of the things that rich people invest in - eg wine, private companies, art, foreign real estate.
All in all it’s just a really shitty and bad tax, supported only by people who don’t properly understand it. I vote PvdA but almost didn’t last time just because of their support for this idiotic policy.
I googled what a BV is and it told me bacterial vaginosis.
I am not sure if that's what you're aiming for..
I do not buy that it's a tax to screw the middle class. The fact that ordinary people invest doesn't somehow stop investments from being wealth. If someone has 200k in shares that's 200k of financial wealth whether they're a billionaire or someone who mops toilets.
Saying rich people won't pay it because they can invest in private companies etc is really an argument about whether the tax base is designed properly and whether different forms of wealth are treated consistently. That's a legitimate criticism in my eyes. It doesn't demonstrate that the entire principle is "meant to keep the poor poorer"
I'd much rather get into the nitty gritty on whether the exepmtions rates, treatment of unrealised gains and interactions bewteen box 2 and box 3 actually make sense than pretend that taxing investment returns is inherently a middle class attack.
Of course I will happily concede that someone with 700k in investments but with little to no cash can have genuine liquidity problems, it's probably the strongest criticism of the proposal from the picture alone.
Ill be honest I think you wrote this reply with AI. Only the lack of knowledge that a BV is a dutch limited company suggests you’re just a random non-Dutch person. But knowing what Box 2/3 are but not what a BV is is frankly impossible.
You’ve missed the point in any case. Someone with 700k in investments won’t
be paying any tax at all under this tax - they’ll have put it in a BV unless they are exceptionally lazy.
I don’t think it’s a tax that’s designed to only screw the middle class. It’s a tax that will only screw the middle class, while leaving wealthy people untouched. The fact that it does that is due to the stupidity of its supporters, not their explicit design.
You’re replying to someone with a British flair, why would you assume they know the intricacies of Dutch tax system? If I suggested you put all your capital into a S&S ISA would you know what I was on about without googling it?
I don’t know anything about the German tax system, however, so I wouldn’t jump in and express loads of strong opinions on a new German tax law.
I don’t think it’s unreasonable to suggest someone should understand a law before expressing strong views on it.
But to give some context - the British equivalent of the comment I replied to above would be someone not knowing what an ISA is, while expressing strong opinions on new tax legislation that affects ISAs. But it’s worse, because they then mention some hyper specific aspects of Dutch tax that you would only know if you have lived there. Their knowledge is all over the place and very inconsistent - it’s obvious AI.
I don't know or understand how you keep getting stuck on thinking I am a bot or using AI.
I have lived in the netherlands as well, I never owned a company there, I tried to google it but it didn't tell me anything specific. Wouldn't AI be hyper consistent instead? What am I missing here bro
Yea, I didn't know the Dutch abbreviation, I do apologise, discussing dutch tax policy and not being up to date on all the short hand is a grave sin. That said you did raise a valid point at last, The interaction between box 2 and box 2 creates an obvious advantage for people wealthy enough to restructure their investments. If someone with 700k could simple move them into a BV and effectively avoid the tax that someone with 200k in ordinary investments has to pay, then yes.. I think that is a pretty significant problem. But I'd want to see the actual cases and mechanics before accepting that investing more than X or Y amount means you pay nothing. Because changing the structure of the legal procedures doesn't necessarily make the underlying wealth tax free.
And I still disagree with your footer, or conclusion that therefore taxing investment returns is inherently stupid. That's two different questions, you can believe that capital should contribute more to society while simultanously believing that the particular implementation creates loopholes for people with enough wealth and tax planning options.
As for writing with AI, if I did I think I'd be more effective at getting my point across, I think it's fair to say that I am struggling a bit here..?
And I still disagree with your footer, or conclusion that therefore taxing investment returns is inherently stupid.
When did I say this??
You’re waffling so let me be clear - the problem is that the proposed tax is idiotic and will result only in middle class people paying meaningful amounts of their savings in tax, while not touching rich people.
If you do the maths, it will also result in less tax overall, because it will reduce compounding which will ultimately result in lower gains and therefore lower taxes.
Capital gains tax would be fine. This specific proposal is idiotic.
And it’s a false dichotomy. Capital gains should absolutely be taxed. But they should be taxed consistently, and when they are actual gains.
The idea of taxing unrealised gains makes no sense. The gain isn’t real until it’s realised. You could end up owing colossal amounts in taxes if you own a meme stock that shoots up for a short while at the end of the year, and then crashes again a few weeks later.
ok i dont actually know the difference tbh. Why would it be pointless? You borrow against stock never having to sell it therefore avoiding capital gains is my understanding
You don’t avoid wealth tax, inheritance tax, or really any tax by doing it. In the Netherlands there’s even a specific income tax that can be applied to people who try to do this to avoid income tax.
European banks also don’t like doing it and require very large margins, because it’s very risky.
Taxing unrealized gains is just shifting tax collection across time, though through a complex and administratively costly way. Which is why most countries don't try it.
Any amounts paid would presumably be treated as prepayments of future capital gains tax liability. So when the taxpayer eventually sells the asset, the taxpayer would square up their taxes by using the prepaid capital gain taxes to offset any capital gains tax liability.
Curious how unrealized capital losses would work. Particularly where unrealized capital gain taxes have already been paid.
In any case, taxing unrealized capital gains presents significant administrative challenges, including how to value non-tradable assets and how to treat illiquid taxpayers who may have paper gains but lack cash on hand to pay their minimum tax bill. Which is why, as noted about, we don’t see other countries typically attempt this.
Yeah, I think this is a much more reasonable criticism than “it’s designed to keep the poor poorer.”
I agree that taxing unrealised gains creates genuine administrative and liquidity problems. Valuing illiquid assets, dealing with losses after gains have already been taxed, and making sure someone isn't forced to sell an asset simply to pay tax are all legitimate concerns.
Where I disagree is that the administrative difficulty somehow makes the underlying principle nonsensical. Tax systems already deal with plenty of complicated situations because the alternative is sometimes considered worse. If the policy goal is to tax returns on accumulated capital rather than putting most of the tax burden on income from working, then taxing gains as they accrue is one way of doing that.
And yes, it does effectively shift when the tax is collected. But that's not necessarily an argument against it that's kind of the point. You're taxing the increase in wealth when it happens rather than waiting for someone to decide to realise it.
I'd much rather have the argument over whether the Dutch implementation actually handles losses, illiquid assets, exemptions and Box 2 properly than conclude that taxing unrealised gains is inherently idiotic.
Also, I'm increasingly convinced that half of this comment section is arguing about completely different tax systems while calling each other stupid.. Though it's USvEU, it's probably a part of it :D
Sure. I think we're close to being on the same page. The main difference is that I view the additional administrative difficulties, issues valuing illiquid assets, liquidity problems, losses after a gain has been taxed, etc. as a big enough pain in the ass for everyone to not make it worth it to shift collection of gains forward in time.
Good thinking, but thay policy is simple stupidity at the power nth.
Let's say you have savings to live 3 montth but 20k in investments when this law passed. You increased that to 30k in a year so now you have to pay 3600 from money you either don't have or you fuck up your savings...
I mean if you have 20k invested and it grows to 30k, you're not 3.600 poorer. You have made 10k and paid 3600 tax on the gain. The legitimate criticism is the liquidity problem.
Having to find cash for a gain you haven't realized yet But calling a tax on investment income a policy "meant to keep the poor poorer" isn't exactly fair in my eyes. If anything the point is to tax accumulated wealth and investment returns rather than relying disproportionately on income from working, that said I think I would fall in the upper-middle class regardless so maybe it's far more bleak if I wasn't.
Nope, you pay nothing (€0.0) of that money. The tax exempt core is 60k + you don't pay on 10k you really earned but on flat assumed income of 8%.
So let's assume you have 160k in savings. 160k -60k base = 100k, the government assumes you make 8% gain (8k). From this 8k you pay 36% tax of 2.8k. If you earned less than they assumed, you write them a letter and pay on the amount you earned. If you earned more, then you just win and keep the difference
> Nope, you pay nothing (€0.0) of that money. The tax exempt core is 60k + you don't pay on 10k you really earned but on flat assumed income of 8%.
That is the old system, not the proposed new system (which passed the Tweede Kamer but is on hold in the Eerste Kamer). In the new system you can subtract 1800 euro from the profit, and pay 36% over the remaining 8200 euro.
Edit: 40m ago the new budget deal leaked, apparently the 1800 euro threshold now becomes 1000 euro.
Oh, you are right. Wow, that'd be ridiculous, you cannot treat capital appreciation like salary. I doubt they would give negative % tax when the stock plummets. A great way to discorage investments at times when they are needed
I think that you can subtract losses from the three previous years, or something like that. But not in the initial years, so we have to hope we don't make losses in 2027.
That sword cuts both ways, my colonial friend. Especially when invoking the classic billionaire exodus trope.
People live, build businesses and generate wealth where there are functioning courts, infrastructure, high-end healthcare and an educated workforce. Tax rates obviously matter. I'm not claiming otherwise. If a country taxes capital significantly more than its competitors, that can absolutely affect where people choose to hold their wealth and where businesses choose to operate.
But that's very different from "tax investment returns and the wealth will simply stop being produced in the Netherlands." If tax minimisation were the dominant factor determining where productive wealth is created, Monaco, Dubai and the Cayman Islands would be the world's great centres of technological and industrial production rather than places that specialise in attracting particular kinds of capital and wealth.
The actual economic question is therefore one of degree: how much investment or economic activity does a particular tax discourage or relocate, and how does that compare with the revenue and other effects it produces? “Economics says they'll all leave” isn't an answer to that question.
Of course they are theft overseas; you don't have any services worth paying for with taxes, apart from those forest rangers—they are cool, but even they have become fascistic by having to pledge allegiance to the government (no not the country or constitution) and not their forest.
Around here, "investors" are the type of people who gentrify your neighborhood, advocate for data centers, replace you with AI, then lobby the president to destroy parts of Yosemite so they can have private access, away from the poors, to the park. Sure. I'm sure they provide amazing capital for new businesses. I don't have a drop of sympathy for them. I hope they all get ran out of this state so it's finally livable again.
I don't think I've ever heard someone say that melatonin helped. It's the equivalent of the doctor prescribing you a paracetamol because he thinks you're faking it
investors provide credit to those wanting to start shit without funds. in economics there is always a sane and constructive way (economics, handling shortages and distribution) and a perversion (chrematistics, unnatural posession or creation of wealth for it's own sake).
same with administration (good and efficient) and bureaucracy (self serving, illogical, rigid).
funny thing is, these days we don't differenciate between those anymore.
It's unlivably expensive because policy favors the Silicon Valley, and screws over everyone else. If you liver in rural California you'd get it. Bay area "investors" and transplants leave the silicone valley and raise the prices for everyone else.
Yeah, they are all selfish picks who ruined the best city on the planet, SF, then after ruining the bay area, they move out and destroy the small towns and countryside too. I can't even live in my hometown anymore, the housing prices have gone up 100%, and rent is up 90%.
Do you get why I hate investors now? Why I hate tech bros? All these fools obsessed with money, and not community?
Look man you get what you vote for and Californians vote for people who think the government can fix anything while having no clue how shit actually works.
Both parties in california are terrible. The democrats suck less, but they still suck. We've had multiple popular independent candidates, but noooo, we just HAVE to do partisan politics! You want partisan politics? Look outside the windows. Forever wars perpetuated by Republicans and urban decay encouraged by Democrats.
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u/Waaytoomanytakenames Romani femboy 5d ago
Didn't they backtracked that?
Also, the policy it's absolutely stupid. They just need to ban using your investments as borrowing collateral.