Warren's wealth tax plan is eye-rollingly bad. Talk about a compliance nightmare.
Formal valuations of property that isn't publicly traded are very expensive and also subjective. They are already frequent subjects of "dueling" valuation experts in courtrooms. Are we going to invent a whole new court for this? Because arguing about the actual value of property will be an all day, every day affair for a specialized court.
Are we going to make people sell their businesses, real estate, and farms, in order to pay the wealth tax? Because how else will they pay the wealth tax if their assets are illiquid?
And if we just restrict the wealth tax to liquid assets with a known value, such as securities, then the whole thing is pointless because people will just invest in non-liquid assets and private securities. In fact, an entirely new class of investments will doubtless be invented practically over night to help rich folks loophole their way out of wealth tax.
There's a reason people hate AMT. The government basically created a second tax system to exist next to our normal tax system in the hopes of capturing higher income taxpayers who were deducting "too much." Over time, the number of people affected by AMT increased and it became a general annoyance. Estate tax is an older, but similar example. For a tax that affects a small number of people, it sure gets tweaked a lot and sucks up a lot of Tax Court time (and what is the most litigated aspects of estate tax? Valuations. Remember estate tax is a wealth tax - just a wealth tax that kicks in after you die. It's a tax on the value of your estate).
Warren is basically proposing to impose the estate tax every year, and all of the BS litigation and compliance issues that should normally happen once in a lifetime are going to become a bureaucratic nightmare. And all of the BS loopholes the rich use to get out of the estate tax? Guess what. They will all work with a wealth tax, too.
So what's the point? We already have (albeit imperfect) ways to tax the rich. Lower the estate tax exemption so that more people are impacted by it. Add some new tax brackets for the rich. Raise capital gain rates for the rich.
That said, if a wealth tax does get imposed, I'm going to sell my tax firm and just become a valuation expert full time. Warren's plan would line my pockets with dollar bills.