Wealth tax is obviously (I think!) the best kind of tax but the problem with it is it's hard to collect (you would need to assess wealth of everyone and that is a problem).
So if I start my own company I have to give away 10% of that company every year? Because I own shares in my company. And those shares have value. Which contribute to my wealth. That seems terrible!
I don't see how a wealth tax is a good idea at all. If you could recommend a good article that argues why it's good and how it would work I'd love to read it.
Please consider what kind of behaviour you would encourage. If wealth erodes every year then this strongly disincentives long term thinking and rewards business ventures which give quick cash and then burn out, like strip mining, and punishes planning for the future like pensions.
You want your tax system to reward long term thinking, not punish it.
I don't understand why it would encourage what you are predicting. If you "quickly cash out and burn" then you pay a tax on it as well.
My argument for wealth tax is that people with most wealth are the ones with the strongest interest to keep the country stable and nice place to live in.
