by Tony Glisson

Created on: October 30, 2008

American politicians of all stripes love to talk about taxing the rich (thus somehow spreading some of the wealth around). Those to the left, even the super wealthy, make no bones about it. They tell us they want to tax higher income people, sometimes naming a certain amount like $250,000.00 annually as the income of the rich. And when they want to have us believe that $250,000.00 is truly a lot of money, they call it a quarter "million" dollars. Do you hear that word "million?"like in "millionaire?"

But right wing politicians, although being a bit more subtle about it, lead us to believe that they too want to put a higher rate of taxation on the wealthy, or they tell us that the higher income earners already pay higher taxes. And while this is probably true, the higher paid people may not be paying a higher rate on their actual income.

Notice however that neither the left (usually Democrats) nor the right (usually Republicans) speak of assessing tax on actual wealth, but only on income, on what we bring in, not on what we have (A good thing, I believe). And for many people income is only a small part of their material wealth.

To better define wealth, let it be noted that tax on wealth (on what we actually own) can and does happen at the local level. * This wealth tax is sometimes called Ad Valorem* or property tax: it is usually paid to city and/or county officials on vehicles and real estate. And certainly a two million dollar mansion, especially one completely paid for, represents greater wealth than a three bed room/two bath bungalow on a half acre lot. Thus the proprietor of the mansion will pay tremendously more to the property tax people, although maybe not a higher rate. He or she will probably also pay a large Ad Valorem amount on each new or nearly new luxury vehicle in the garage.

Homes represent greater wealth while the owners live in them than they do when the owners sell them. This is even more so with motor vehicles, which almost always lose dollar value, while real estate gains some monetary value over time. (I believe the recent downturn in the real estate market is temporary, thus making it a good time to buy and own a home, which may represent much greater wealth than its present dollar value.)

The Fair Tax in HR 25 (23% consumption tax being considered) actually taxes the wealthy because wealthy people purchase more new stuff and more expensive stuff than middle class and poor people do. But even the Fair Tax hits the middle class at a higher

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