Harberger taxes are a proposed solution to the assessment problem and are frequently mentioned on online forums. These taxes may suffer the same problems currently facing mobile home parks.
I agree the Harberger tax does not make sense for general use on property or land taxes.
I do think a Harberger tax would make sense if we want to at some point talk about applying a more general wealth tax to the ultra-wealthy -- say, some kind of progressive wealth tax on the amount of any personal net worth above $100M (threshhold to be indexed to some reasonable inflation metric, perhaps the GDP deflator).
Once you plausibly might have a fortune that large, you'd be responsible for providing an accounting of your assets and their worth, with the usual Harberger incentives to get the value right. Typically this would _not_ include direct ownership of stuff like a start-up's HQ, because that's inside of a corporate entity, and we're only talking about _personal_ fortunes, not a modification to corporate taxes.
So somebody could come along and make an offer to buy up some multi-centi-millionaire's _equity stake_ in a startup they'd invested in, but that seems fair enough. Either they've made a successful exit, or they bump up their valuation, and either way it's great press for the start-up in question.
A startup _founder_ who isn't previously wealthy would not need to start filing for the tax until they plausibly are worth >$100M. You might perhaps have some concern about investors forcing a sale, turning a founder into a mere executive employee rather than owner / director... They may be "asset rich but cash poor". I'm skeptical this would be a serious problem, though. It's well-known that folks who manage to get that rich find it fairly easy to borrow against their equity at low rates, and there are mechanisms like Second Market to sell off claims on small slices of equity even before IPO, if you need to generate cash to cover the taxes on an appropriate valuation. If making such sales erodes founder control over the longer term, well.... good! The whole point here is to prevent control over the economy (which is often embodied in large equity stakes in important companies) from being permanently concentrated in a small number of hands.
It's an interesting idea, especially with the trend of companies staying private longer and not IPOing. Stocks seem mobile enough and not tied directly to some other asset.
There's a problem of knowing who has $100m in assets to begin with--that is, who has to report--but I suppose that's either easily solved through a gut check. I doubt that many people are at the margins. You either have $100m, or you don't. Alternatively, a blanket policy could be anyone can buy all your assets for $100m unless you report your assets at over $100m.
I agree the Harberger tax does not make sense for general use on property or land taxes.
I do think a Harberger tax would make sense if we want to at some point talk about applying a more general wealth tax to the ultra-wealthy -- say, some kind of progressive wealth tax on the amount of any personal net worth above $100M (threshhold to be indexed to some reasonable inflation metric, perhaps the GDP deflator).
Once you plausibly might have a fortune that large, you'd be responsible for providing an accounting of your assets and their worth, with the usual Harberger incentives to get the value right. Typically this would _not_ include direct ownership of stuff like a start-up's HQ, because that's inside of a corporate entity, and we're only talking about _personal_ fortunes, not a modification to corporate taxes.
So somebody could come along and make an offer to buy up some multi-centi-millionaire's _equity stake_ in a startup they'd invested in, but that seems fair enough. Either they've made a successful exit, or they bump up their valuation, and either way it's great press for the start-up in question.
A startup _founder_ who isn't previously wealthy would not need to start filing for the tax until they plausibly are worth >$100M. You might perhaps have some concern about investors forcing a sale, turning a founder into a mere executive employee rather than owner / director... They may be "asset rich but cash poor". I'm skeptical this would be a serious problem, though. It's well-known that folks who manage to get that rich find it fairly easy to borrow against their equity at low rates, and there are mechanisms like Second Market to sell off claims on small slices of equity even before IPO, if you need to generate cash to cover the taxes on an appropriate valuation. If making such sales erodes founder control over the longer term, well.... good! The whole point here is to prevent control over the economy (which is often embodied in large equity stakes in important companies) from being permanently concentrated in a small number of hands.
It's an interesting idea, especially with the trend of companies staying private longer and not IPOing. Stocks seem mobile enough and not tied directly to some other asset.
Unless, you are in the strange predicament of OpenAI where it could be argued Elon effectively held up OpenAI, but this is OpenAI's own doing and mess (https://www.astralcodexten.com/p/openai-nonprofit-buyout-much-more?r=4rhmcp&utm_campaign=post&utm_medium=web&showWelcomeOnShare=false) .
There's a problem of knowing who has $100m in assets to begin with--that is, who has to report--but I suppose that's either easily solved through a gut check. I doubt that many people are at the margins. You either have $100m, or you don't. Alternatively, a blanket policy could be anyone can buy all your assets for $100m unless you report your assets at over $100m.