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This comment is based on the interpretation of the proposal found in this post Proposed And Updated Version Of Billionaire Tax. I don’t have a week to read and digest the 100+ pages of the proposed law but based on the description in the proposal here are my comments:

The US currently has (in effect) separate tax systems for: Employees, small business people, those who live off investment income, Americans abroad, undocumented aliens, certain racial minorities (see the work of Dorothy Brown) and now a new tax system for billionaires is proposed. So, in America of today: Congress asks tell me who you are and we will tell you which tax system applies to you. (How can this be fair?) The proposed tax system for billionaires borrows from some of the most vicious aspects of the tax system for Americans abroad and would apply them to billionaires.

Prospectively – The billionaires tax once is is up and running:

Written by John Richardson | Posted in Billionaire Tax Proposal

Senate Finance Committee Chair Ron Wyden, D-Ore., unveiled an updated version of the Billionaires Income Tax, which would ensure billionaires pay more tax every year. According to the proposal, the Billionaires Income Tax would apply to taxpayers with more than $1 billion in assets or more than $100 million in income for three consecutive years.

Tradable assets like stocks would be marked-to-market every year. Billionaires would pay tax on gain and take deductions for losses on tradable assets annually. Billionaires would be able to carry forward losses, and, in certain circumstances, carry back losses for three years.

Non-tradable assets like real estate or business interests would not be taxed annually. When billionaires sell non-tradable assets, they would pay capital gains tax, plus an interest charge. The interest charge, or “deferral recapture amount,” is the amount of interest that would be due on tax owed if the asset had been marked to market each year and the tax had been deferred until sale. The interest rate is the applicable federal short term rate plus one point. The AFR is currently 0.22 percent, so the interest rate applied would be 1.22 percent.
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Written by TaxConnections Admin | Posted in Billionaire Tax Proposal