The dangerous attraction of wealth taxes

I’ve written about the deceptive attraction of wealth tax in my Telegraph column today, and I wish I was wasting my time. Once, you could say it was an idea so flawed that it stood no chance of getting into government. In the coalition era, there is no such thing.  Tory ministers will wave through an idea they regard as nuts because the Lib Dems want it, and that coalition is about compromise. Political horsetrading has supplanted rational economic debate, and if the Lib Dems want a wealth tax there is a horribly high chance that Osborne may give way — as he almost did over Mansion Tax. Not because he is weak, but because that’s how this coalition works. Here are my main points.

1. The idea of a wealth tax is superficially attractive. You pick something — property, or even all assets — and say that the state will take 1 per cent of the value of this every year.