Possible tax on Art and wine even if not sold, how long before coins are in that mix? 0

[Coinbuf]

From USA Today, "Should the wealthy pay taxes on expensive art and wine? Joe Biden thinks so. Here's how it would work". If something like this became reality, I have to think that coins would be put onto that list along with physical gold and silver. Should this or some version of this be enacted into law how do you think the rare coin market be impacted? Here is a link to the article for those interested in reading it.

Please this is not about politics just wondering if others would have concerns about this type of policy and the impact on collectors and the coin market.

USA Today

[Woods020]

I think it’s concerning for many reasons, including this hobby. First I think it is BS to pay a tax on an unrealized gain. It is and always has been a gain only when a transaction occurs. Then the selling price is compared to purchase price, and taxes are paid. For collectibles it’s 28%.
 

Saying someone has to pay for an unrealized gain is ridiculous. What would happen if it loses value? Do you get a tax credit? Is it capped? I’m sure if they even allow a credit it will be similar to capital gains from the stock market. Full taxation on the sell of stock in the year the gain occurred, but a maximum of only $3k a year in loses. Extremely inequitable. 

For numismatics and any collectible this would definitely deter anyone from wanting to invest any meaningful amount. There would be far better and fairer ways to use the money at that point. Collections would go back to circulation examples in basic books I would imagine. 
 

The only good thing, if there is one, is he said households worth more than $100M. I can’t speak for others, but myself I’m a little shy of that threshold to say the least. Now do I think it’s fair to punish someone disproportionately because they are successful the answer is a resounding no. Why punish success unless it is I’ll gotten gains???

Edited April 11, 2022 by Woods020

[GoldFinger1969]

It is probably unconstitutional and it is unworkable.  

As soon as lower-income and middle-class homeowners get hit with $10,000 or $25,000 unrealized gains taxes (double or triple what they pay in actual property taxes), this experiment in Marxism will be kaput.

It can't work with liquid assets, like stocks or semi-liquids like real estate.  It is a joke to think it can apply to untraded assets like art or coins.

[RWB]

Luxury taxes have been around for centuries, as have "sin" taxes, real estate transfer taxes, inheritance taxes, property taxes and a host of other fees. Some are intended to recover government costs for certain activities, others produce general revenue used for common community purposes, and others are there to discourage resource waste. The overall income tax is supposed to be progressive - higher rates for higher earners - but it also includes so many loopholes that high earners easily avoid high rates by paying for expert accounting advice most families cannot afford.

Capitalist economic/political systems have many more direct taxes and fees than other systems, but the real impacts must relate to total cost-benefit, not a hodgepodge of specific tax names. Nothing prohibits a surtax on non-necessity expenditures over $1 million, and most states already tax routine personal property such as aircraft, boats and cars.

[Woods020]

Before long we will have to pay emissions taxes every time we fart…

[Woods020]

On 4/11/2022 at 2:26 PM, RWB said:

Nothing prohibits a surtax on non-necessity expenditures over $1 million, and most states already tax routine personal property such as aircraft, boats and cars.

These taxes are use taxes. Justifiable in some ways to maintain resources you enjoy by using these items. For example car taxes maintain roads, boat taxes maintain waterways/boat launches, and aircraft tax pays for ATCs. How could one justify a similar use tax on a coin sitting in a safe?

[Coinbuf]

Something to keep in mind, any legislation enacted written as the current proposal would not have any direct effect on anyone here, as proposed it only would affect the top 1% of the wealthy.   But the long term effects of this kind of policy, and the almost inevitable slippery slope it presents is where the real danger lies, simply put once you open that bottle it will be near impossible to recork.

[GoldFinger1969]

On 4/11/2022 at 7:34 PM, Coinbuf said:

Something to keep in mind, any legislation enacted written as the current proposal would not have any direct effect on anyone here, as proposed it only would affect the top 1% of the wealthy. 

Yup, just like the income tax.  Only gonna target the rich !!  

On 4/11/2022 at 7:34 PM, Coinbuf said:

   But the long term effects of this kind of policy, and the almost inevitable slippery slope it presents is where the real danger lies, simply put once you open that bottle it will be near impossible to recork.

We have a winner !   

[zadok]

...well, regarding coins....just how r they going to know who owns what?, send out a questionnaire? go door to door?..ill be glad to show them my circ lincoln whitman tri-fold...n if they request/legislate the auction houses to provide auction results id think there be one hell of a backlash....n reduction in sales....

[Zebo]

On 4/11/2022 at 9:10 PM, zadok said:

...well, regarding coins....just how r they going to know who owns what?, send out a questionnaire? go door to door?..ill be glad to show them my circ lincoln whitman tri-fold...n if they request/legislate the auction houses to provide auction results id think there be one hell of a backlash....n reduction in sales....

First they go after your registry sets. Then they’ll have your neighbors snitch on you. 

[Zebo]

On 4/11/2022 at 8:31 PM, GoldFinger1969 said:

Yup, just like the income tax.  Only gonna target the rich !!  

We have a winner !   

Yep and income tax was only going to be temporary to pay for the war.

[Coinbuf]

On 4/11/2022 at 6:10 PM, zadok said:

...well, regarding coins....just how r they going to know who owns what?, send out a questionnaire? go door to door?..ill be glad to show them my circ lincoln whitman tri-fold...n if they request/legislate the auction houses to provide auction results id think there be one hell of a backlash....n reduction in sales....

The data can be made available going forward on sales from retail sites and auction houses, all the government has to do is decide that they want it and they can get it.   How many times have you read about a family that lost a home or business to eminent domain, the government has the power to do as it wants with no regard for your feelings about it all under the umbrella of "for the greater good".    Heck even insurance records could be used to see what assets people are insuring, and bank records can be accessed to see the inflow of monies.   Also with the new 1099 reporting that went into effect earlier this year your ability to sell and convert assets to cash is easier to track.

So while you might be able to hide it for now over time assets will be uncovered as they are sold and if those assets can be traced back to you, you (or your heirs) then might be on the hook for fines and interest.

I agree that it seems a very daunting and unwieldy task, but as we keep moving into a world with more digital tracking of your actions it just gets easier and easier to follow each persons movements.

[Moxie15]

On 4/11/2022 at 3:24 PM, GoldFinger1969 said:

It is probably unconstitutional and it is unworkable.  

 

 

 

Counties in Florida used to have tangible and intangible taxes (I no longer live there so do not know if they are still in force) so I doubt they are unconstitutional, and they are workable. This is basically an intangible tax. 

[GoldFinger1969]

On 4/12/2022 at 6:37 AM, Moxie15 said:

Counties in Florida used to have tangible and intangible taxes (I no longer live there so do not know if they are still in force) so I doubt they are unconstitutional, and they are workable. This is basically an intangible tax. 

I believe they ditched them.  Virginia used to tax cars.

Wealth taxes are clearly problematic from a constitutional perspective.

[gmarguli]

The article linked is like cancer for rational thinking. The current state of journalism in this country (world?) is horrifying. 

[zadok]

On 4/11/2022 at 11:44 PM, Coinbuf said:

The data can be made available going forward on sales from retail sites and auction houses, all the government has to do is decide that they want it and they can get it.   How many times have you read about a family that lost a home or business to eminent domain, the government has the power to do as it wants with no regard for your feelings about it all under the umbrella of "for the greater good".    Heck even insurance records could be used to see what assets people are insuring, and bank records can be accessed to see the inflow of monies.   Also with the new 1099 reporting that went into effect earlier this year your ability to sell and convert assets to cash is easier to track.

So while you might be able to hide it for now over time assets will be uncovered as they are sold and if those assets can be traced back to you, you (or your heirs) then might be on the hook for fines and interest.

I agree that it seems a very daunting and unwieldy task, but as we keep moving into a world with more digital tracking of your actions it just gets easier and easier to follow each persons movements.

...well guess future purchases all be in cash only...and when sell cash or potatoes only....think going go with new procedure, every coin purchased also buy one bullet.....

[zadok]

On 4/11/2022 at 11:18 PM, Zebo said:

First they go after your registry sets. Then they’ll have your neighbors snitch on you. 

...im going tell them my nearest neighbor is Hoghead n he is mean, just ask his neice's  (ex)boyfriend.....

[VKurtB]

On 4/11/2022 at 2:26 PM, RWB said:

Luxury taxes have been around for centuries, as have "sin" taxes, real estate transfer taxes, inheritance taxes, property taxes and a host of other fees. Some are intended to recover government costs for certain activities, others produce general revenue used for common community purposes, and others are there to discourage resource waste. The overall income tax is supposed to be progressive - higher rates for higher earners - but it also includes so many loopholes that high earners easily avoid high rates by paying for expert accounting advice most families cannot afford.

Capitalist economic/political systems have many more direct taxes and fees than other systems, but the real impacts must relate to total cost-benefit, not a hodgepodge of specific tax names. Nothing prohibits a surtax on non-necessity expenditures over $1 million, and most states already tax routine personal property such as aircraft, boats and cars.

Whereas Pennsylvania does not. Real estate only, and not by the state. Municipalities and school districts only. I do not YET have an understanding for Alabama. I will.