There is a newly published paper by Paola Profeta, Simona Scabrosetti, and Stanley L. Winer. The most concrete statement of the argument is that wealth is held disproportionately by the elderly, and they will oppose wealth taxes just as they oppose cuts in Medicare. And since 1965 wealth taxation has in fact gone down in many Western countries, even though some theoretical arguments may militate in its favor. The abstract of the paper is this:
We present an empirical model of wealth transfer taxation in the revenue systems of the G7 countries—Canada, France, Germany, Italy, Japan, the UK, and the US—over the period from 1965 to 2009. Our model emphasizes the influences of population aging and of the stock of household wealth in an explanation of the past and likely future of this tax source. Simulations with the model using U.N. demographic projections and projections of household wealth suggest that even in France and Germany where reliance on wealth transfer taxation has been increasing for part of the period studied, wealth transfer taxes can be expected to wither away as population aging deepens over the next two decades. Our results indicate that recent tax designs that rely upon the taxation of wealth transfers to preserve equity in the face of declining taxation of capital incomes may be, in this respect, politically infeasible for the foreseeable future. We conclude by using the case of wealth transfer taxation to raise the general question of the extent to which the consistency of a proposed reform with expected political equilibria ought to play a role in the design of a normative policy blueprint.