capital levy

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capital levy,

form of taxation by which the government takes part of the capital of any person or business, as distinguished from a tax on personal or business income. It is usually applied to all capital above a certain minimum and may be set aside for a specific purpose, such as the reduction of the public debt. It was used by several European nations experiencing financial difficulties after World War I, and has been advocated as a measure of social welfare and a deterrent to war profits. Opponents of the capital levy stress its implied penalty on saving. In World War II, Great Britain and the United States resorted to extremely high rates of direct taxation in order to accomplish many of the aims of the capital levy.
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The rational dictator will find inflationary capital levies most worthwhile during emergencies (especially wars) that put present revenues at a large premium over future revenues by threatening his reign (Glasner [1989]).
However, three months later, on June 26, the eurozone finance ministers reversed their reversal and confirmed that more capital levies (which they sometimes euphemistically refer to as "stability fees" and "stability levies") would indeed be the model for dealing with troubled banks.
The usual enablers in the establishment media choir have been assisting in the subterfuge, pitching the new EU policy on capital levies as a boon relief to taxpayers and a long-overdue squeeze on "wealthy" investors and savers.