First income taxes get taken out from what people earn.
Then a sales tax is applied to what is spent of the remaining.
Finally, if what remains increases in value, the increase in value is then taxed.
Fundamentally the asset that is being taxed, doesn't belong to the Government, so why do they have a claim to the appreciation in value, if they don't have a claim to the asset itself.
The truth is that capital gains, prove that the asset doesn't belong to you, if it did you would keep all the value of it. The asset belongs to the government, and they let you keep some privileges of possessing that asset.
In a simplified example:
The person in this table earns $100, spends $50 and dies leaving $20
The person has paid tax on the same money 3 times.
Despite none of the tax rates being over 40%, the person in this example pays a total of 48% of income in cumulative tax in the end.
Its no longer what's mine is mine, its what's mine is the governments.
Savers are thought of in society as doing the right thing and being responsible, but a capital tax penalises these very people. Most governments want their citizens to save more, at least they say they do, and this policy is contradictory.
Spenders are only taxed once.
Not only are you taxed, but you have to give thought to how to minimised, taking you away from other activity's, and you may incur costs making sure you comply and lose even more money to accountants and Lawyers in the process. Those Accountants and lawyers are then working on capital tax rather than real productive work.
Governments don't like people with savings, people with savings are not dependent on the government. They would rather take money off these people so that they could give some of it back with conditions and take credit.
When you die or divorce capital gains kicks in, these are not good pieces of news, but having to sell assets to pay the tax bill at the same time, is like a kick being kicked when down.