Sure, their accountants will have a little more paperwork, on top of their current workload. There is a cost to that. But if the total is well under the wealth tax threshold, there’s no tax and little risk of an audit that re-evaluates it’s worth. And if they are above it, then a small % of the excess will incur a tax.
If it is ever discovered that they failed to declare wealth (owned or controlled), THAT is when a penalty tax comes in, and they might find themselves obliged to pay $2mil in the US for that painting in Switzerland.
There is of course much more complexity to implementing this well. International treaties would need to be changed, to align reporting requirements and to limit loopholes that enable foreigners to avoid reporting and tax obligations (eg. an automatic wealth tax on foreign held assets in the absence of a tax treaty). There’s cost there too.
This kind of thing gets discussed occasionally, but so far hasn’t gained traction. Realistically, I don’t expect it to.
Sure, their accountants will have a little more paperwork, on top of their current workload. There is a cost to that. But if the total is well under the wealth tax threshold, there’s no tax and little risk of an audit that re-evaluates it’s worth. And if they are above it, then a small % of the excess will incur a tax.
If it is ever discovered that they failed to declare wealth (owned or controlled), THAT is when a penalty tax comes in, and they might find themselves obliged to pay $2mil in the US for that painting in Switzerland.
There is of course much more complexity to implementing this well. International treaties would need to be changed, to align reporting requirements and to limit loopholes that enable foreigners to avoid reporting and tax obligations (eg. an automatic wealth tax on foreign held assets in the absence of a tax treaty). There’s cost there too.
This kind of thing gets discussed occasionally, but so far hasn’t gained traction. Realistically, I don’t expect it to.