Is a one off wealth tax the answer?

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This video is on the web site of Church Action on Poverty right now, whose campaign for Fair Taxes I am pleased to support:

When Greg Philo first suggested a tax of this sort I admit I was not convinced.

Well, times change. The FT reports this morning (with apologies for lengthy quote, but it's a pretty important issue):

As Italy’s economy and its banks lurch deeper into the eurozone sovereign crisis, some are calling for a one-off mega tax on Italians’ substantial private wealth as a way to offset fears about its €2,000bn ($2,750bn) public debt.

“Private wealth in our country is close to €10,000bn. A tiny percentage of that can contribute in a major way to a step down in our total debt,” says Corrado Passera, head of Italy’s largest bank, Intesa Sanpaolo.

The idea of a mega tax on Italians’ total private assets has gained support in the past week as spreads on Italian debt compared with Germany remained close to a euro-era high – despite the European Central Bank’s decision to buy Italian bonds.

Proponents of the wealth tax argue that it is the fastest way to make a notable cut. They also point out that swift action will allow less time for people to move their assets to tax havens.

A senior private banker who spent the summer at work watching the value of his clients’ investments plunge in the market rout, agrees that ending tax evasion is vital but argues that a wealth tax is needed sooner because its impact will be felt within days not years.

“There’s no time left”, he says, echoing comments made by Ms Marcegaglia, the head of Italy’s business association this week. “We are already on the precipice”.

The unthinkable is becoming thinkable. Greg Philo was ahead of the curve.

The reality is that we are facing something little short of total meltdown. In that case asset values will be wiped out: paying a wealth tax then becomes a viable and welcome alternative to ensure that the state - whose existence and smooth operation is fundamental to the maintenance of wealth - is kept in place.

I have no idea if such taxes will happen, but it would no longer surprise me.