Taxing Net Wealth to tackle Climate Change, eliminate poverty, and completely replace the current tax systems at the national level

 Two days ago, Google released Gemini 3.0 Pro - its new AI system that has shown state of the art performance on just about every benchmark there is. Like many people, I have been trying it out, and I must say that I have been impressed. 

I have just been discussing my suggestions for imposing a global tax on net assets held by individuals, public and private companies, and other asset holders including sovereign wealth funds.  I started with my proposal that a 1% annual tax on net wealth woudl provide the €5 trillion needed to tackle climate change. Gemini agreed. Here are the figures provided by Gemini

• Household Wealth: $475 Trillion
• Public Company Net Assets: $50 Trillion
• Private Company Net Assets: $40 Trillion
• Sovereign Wealth Funds: $13 Trillion
• Total Tax Base: ~$578 Trillion
• 1% Tax Revenue: $5.78 Trillion/year
• Result: Exceeds the $5T target.

I then asked how much would you need to provide $100 a month to every adult on the planet, and half that for under 18s - eliminated poverty at a stroke. Here's Gemini's calculation

The Population Data (2025 Estimates)

Total Global Population: ~8.2 Billion

• Adults (18+): ~5.75 Billion (70%)
• Children (<18): ~2.45 Billion (30%)

Adults get $1,200/year. Children get $600/year.

• Adult Cost: 5.75 Billion × 1,200=∗∗1,200= 6.90 Trillion**
• Child Cost: 2.45 Billion × 600=∗∗600=1.47 Trillion**

TOTAL COST: $8.37 Trillion

Tax Rate Required: 1.44%

So, would I pay a total of 2.5% of my net wealth every year to solve climate change and elminiate poverty. Yeah, sure. 

But then I said to Gemini, how about adding additional net wealth taxes at the national/regional level to replace the current tax system that concentrates on taxing income and profits Here's a summay

The National Option

Individual nations can choose to replace all domestic taxes (Income, Corporate, VAT, Inheritance, Capital Gains) with a National Net Asset Tax.

The Cost: A variable rate (estimated 3%–6% depending on government spending) applied to domestic wealth.

The Gain: The complete abolition of tax returns, payroll deductions, and sales taxes.
The Economic Engine: Maximizing "Velocity"
This system fundamentally alters corporate and individual behavior by penalizing Hoarding and rewarding Flow.

• The "Use It or Lose It" Incentive
• In the current system, a company pays tax when it makes a profit.

In this system, a company pays tax when it sits on assets. To reduce its tax bill, a company must reduce its Net Assets by spending cash.

Corporate Behavior Shift

• Wages: Hiring staff reduces the asset base (cash leaves). Higher wages are tax-efficient 
• Innovation: Spending on R&D reduces the asset base. Innovation becomes a tax shield.
• Dividends: Distributing excess cash to shareholders reduces the corporate tax bill.

Preventing Dynastic Stagnation 

• Wealthy individuals cannot passively live off low-yield interest. An asset tax rate (e.[2][4]g., 5%) higher than the passive risk-free rate (e.g., 3%) forces capital to be actively invested in high-growth ventures or consumed.

Demographic Justice

The Current Trap: Taxes fall heavily on Labor (Income Tax), penalizing the young who are trying to build wealth.

• The New Oprion Taxes fall on Accumulation (Asset Tax).
• A 25-year-old worker keeps 100% of their salary to buy a home.
• The tax burden shifts to the asset-rich demographic (typically 65+), who pay a maintenance fee on their accumulated success.
• Protection: Asset-rich/cash-poor retirees can use a Deferral Mechanism, rolling the tax up as a lien against the property to be paid upon sale or transfer, ensuring no one is forced out of their home.

The Verdict

• For 90% of the population, the cost of the Asset Tax is significantly lower than the combined cost of Income Tax and VAT. The economy transitions from a model of scarcity and hoarding to one of high circulation and rapid growth