“And a wealth tax makes a lot of sense in principle. The problem is that it’s been tried in Germany, France, Sweden and all of those countries ended up repealing it because it had massive implementation problems and did not generate the revenue they projected.”
Yang is right about this. According to an Organization for Economic Co-operation and Development report, “while 12 countries had net wealth taxes in 1990, there were only four OECD countries that still levied recurrent taxes on individuals’ net wealth in 2017.” (And in 2018, France also replaced its net wealth tax with one focused on real estate wealth.)
“Decisions to repeal net wealth taxes have often been justified by efficiency and administrative concerns and by the observation that net wealth taxes have frequently failed to meet their redistributive goals,” the report added. “The revenues collected from net wealth taxes have also, with a few exceptions, been very low.”
Besides France, Germany and Sweden are among the countries that abandoned the wealth tax, as Yang said.