City people will not invest in country people and vice versa. And because there are fewer people able to try for success, there will be less success for the country as a whole. When the capital gains tax is low, and there are more people encouraged to invest in each other, there is also a lot of employment. People on unemployment benefits and welfare rolls are employed and begin adding tax revenues to City Hall and the county and the state, instead of living on public welfare. The payoff for success in the venture is called a capital gain.
Failure is termed a capital loss.
It's bad enough when the government puts a high tax on capital gain, because the people who lose the most from a high rate are the poorest, the youngest, those at the beginning of their careers, those who are furthest from sources of capital. But when the government also taxes gains that arise from inflation, not real gains, then the flow of fresh capital from those who have it to those who need it really dries up. The rate then becomes confiscatory. Inflation is a direct result of the monetary or fiscal irresponsibility of government. To penalize participants in the private economy for the mistakes of government seems to me to be the height of arrogance and irresponsibility.