I want to do some improvements on my house. So I take out a home equity loan. Oops! Actually since my house is worth $500K more than when I bought it, now I have to pay $100K to the government since the gain is now realized by using the asset as collateral!

You get points for effective use of rhetoric, but it's more of a solvable challenge and not a deal breaker.

The goal of a borrowing tax would be to prevent someone with a a $200 mil stock portfolio living off the "buy, borrow, die" strategy and not home equity loans on mere middle class millionaires.

Capital gains, for example, on a primary residence already have an exclusion of a certain amount. There's no reason a borrowing tax can't kick in only after one has let's say 10mil in assets or securities.

Heck, you could even exempt primary residences regardless of value, so you should be fine

edit: here's an explanation of the buy, borrow, die strategy for those who are interested https://www.reddit.com/r/BuyBorrowDieExplained/comments/1f26...

The buy borrow die strategy is made up and absolutely laughable to anybody who knows anything about finance. It is not used by anybody.

Were you able to understand the explanation in the link?

I mean most taxes like this have an 'above X amount' clause. Such as the gains you get taxed on when selling your home. California it's $500K in gains if you are married so extrapolating that your scenario would be covered.