I think we're thread-mixupping here. I was directly replying to someone talking about a 70% tax on income over a certain arbitrary number ($10M/yr)
You're not wrong that a blend of flat tax and treating all material gain as income could tax that one specific scenario more. But it really is a different topic. My take on that topic is "sure, but let's not do it as a flat tax at all. Progressive tax PLUS carefully situated handling of capital gains"
Honestly, we're 99% there if we just revisit all the laws that defer or waive capital gains tax and set a networth ceiling on them. It's ok to defer retirement gains, but maybe not after you have $20M in retirement? The way it works with selling owner-occupied real-estate in my area is a $250K "grace area" for profits, then you're taxed on gains less all bills/investments into the property. For most Americans even lower-upper-class, that's $0 of liability.
We can do the same with retirement, say at the $4m mark (twice the current recommended retirement total, or just round up to $5m). With stocks "ditto, pick an arbitrary large number more than most Americans have). Whatever.
But add a flat tax to that? Why.
Voters can be dumb and may not realize that tax cuts are spending money.
That's true. Voters are more than happy to spend $500 on a $400 tax cut instead of spending that same thing on something that increases their quality of life by approximately $1000 (either by increasing the buying power of the dollar or community-profiting subsidies like EBT).