One of the more absurd ideas floating around is that we must tax wealth more. Some are even suggesting that a rise in an asset value should pay income tax, even if that asset is not sold and the value not crystallised. There really has been a bill put together in the US Congress along those lines - although it’s still a bit too silly even for them to get beyond the thinking about stage.

One reason for the silliness is that of course refunds would have to be paid if asset values fall:

Rishi Sunak’s rise to the top job in British politics has coincided with a colossal fall in the fortune shared by him and his wife, Akshata Murty.

This year’s Sunday Times Rich List, published today, reveals that the couple’s wealth has fallen by more than half a million pounds a day over the past 12 months. Their fortune is now estimated at £529 million.

The couple’s most valuable asset has long been a shareholding in Infosys, an Indian IT giant set up by Murty’s father. When the pair made their debut on the Rich List in 2022 this stake had a value of £690 million.

We’d love to see someone trying to defend a substantial tax refund to someone now only - only - worth a half billion.

But beyond the silliness there’s also another problem - such a tax wouldn't raise much money. The overall level of wealth doesn’t change all that much. Who has it is what changes, certain fortunes rise, others fall. Which means that a very large portion of the receipts will have to be paid out again in refunds. The net, well, the net might well not even be positive for large periods of time.

Adding a tax which gains negative revenue some to much of the time really just doesn’t sound all that sensible.