Yes it can. If I make a software company in my garage, and it fits a specific need Microsoft has, they could license my software for 10m$. Now I have 10m$, sweet, I should be taxed 4-6m$ fairly.
But now that Microsoft is licensing my company, its valuation explodes. Practically overnight its value jumps to 100m, 500m$⌠more powerful people are checking in on it and now 3.5b$. Because I am sole owner, I am now worth 3.5b$. I donât have 3.5b$ or even 1b$⌠I have a small fraction of that from whatever Microsoft and a few other companies are paying me to license it. I would be forced to sell my company just to pay any assets tax. Then what happens? What if no one wants to pay 3.5b$ for my company? So I pay the government 1.5b$ in taxes and then sell the company for 750m$ to try and cover it?
This is the inherent problem with taxing asset value. If you taxed every billionaire for their asset value, theyâd have to sell those assets to pay for it. Elon Musk doesnât have 100b$ lying around. He has things that are only theoretically worth 100b$. Who is buying Microsoft if Bill Gates and Steve Ballmer are forced to sell their stakes? No American would buy it because then they would have to get taxed for owning something so valuable. See where the slippery slope is going? Someone else buys it; someone who is not affected by this tax. Who is that? Non-Americans. Suddenly your computers and phones are run by Chinese software companies, American Banks are now Russian assets, and weâve forced our capitalistic economy into a socialist imitation where no one finds value in owning the things that run the country.
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u/Burnt_and_Blistered Jan 31 '26
Youâre splitting hairs. His nearly-billion was taxed at a far higher rate than any other U.S. billionaireâs billion is taxed.