IMF: Lowering sovereign debt levels through a one-off tax on private wealth

The Coming Global Wealth Tax !?
Indebted governments may soon consider a big one-time levy on capital assets!
Q: How much capital do you keep in private & business bank accounts for a possible 10% confiscation, & what defensive actions are being taken ?

imageAs applied to the euro zone, the IMF claims that a 10% levy on households’ positive net worth would bring public debt levels back to pre-financial crisis levels. Such a tax sounds crazy, but recall what happened in euro-zone country Cyprus this year (2013): Holders of bank accounts larger than 100,000 euros had to incur losses of up to 100% on their savings above that threshold, in order to “bail-in” the bankrupt Mediterranean state. Japanese households, sitting on one of the world’s largest pools of savings, have particular reason to worry about their assets: At 240% of GDP, their country’s public debt ratio is more than twice that of Cyprus when it defaulted.

From New York to London, Paris and beyond, powerful economic players are deciding that with an ever-deteriorating global fiscal outlook, conventional levels and methods of taxation will no longer suffice. That makes weapons of mass wealth destruction—such as the IMF’s one-off capital levy, Cyprus’s bank deposit confiscation, or outright sovereign defaults—likelier by the day.

Link to full WSJ Opinion, The Wall Street Journal by Romain Hatchuel; managing partner of Square Advisors, LLC, a New York-based asset management firm.

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