JP Morgan Chief Executive says wealth tax is almost impossible

Jamie Dimon, JP Morgan Chase Chief Executive says he’s fine with higher taxes on the rich, but a wealth tax is almost impossible to achieve.

At the JP Morgan India summit on Tuesday, Dimon was asked what he thought about the new tax proposal and if he was in favor of it.

"I'm not against having a higher tax on the wealthy. But I think that you do that through their income as opposed to, you, know, calculate wealth which becomes extremely complicated, legalistic, bureaucratic, regulatory, and people find a million and one ways around it," Dimon said. Adding that it is more difficult to cheat on such tax as income is “given.”

Due to the coronavirus pandemic, some of the rich in the United States have become richer, while the masses continue to struggle with their finances. Also, government deficits at both the federal and state levels have risen due to the economic impact of COVID-19. To bridge the wealth disparities, the US government has started to make moves towards increasing taxes for the wealthy. 

In 2018, the Organization for Economic Cooperation and Development published a study that found that the United States lost more tax revenue in the year compared to other developed countries, largely as a result of President Trump's tax cuts.

In the race for the White House, presidential nominee Joe Biden said he would reverse the Trump administration multi-trillion-dollar tax cuts, which according to reports, were more beneficial to businesses and higher-income individuals.

Speaking in support of President Trump’s tax decisions, Dimon said the Trump administration tax policies were part of the “very good things” the president has done for the U.S. economy. Further explaining that the United States is traditionally a “red tape society” with a system that “slows down a lot of businesses.”

Dimon said that slowing down the economy “hurts the disadvantaged more than anybody else.” Therefore, to see the economy grow, the “governments should put more thought into how taxes are structured so that the economy can grow.

“There’re taxes which will slow down growth, like taxes on capital formation, or labor; and there’re taxes which will not affect growth like taxes on, you know, well-to-do people like me,” he said.

Dimon believes that to get an “active” and “healthy growing economy” more thoughts should be given to taxation.