It would have to be limited like Spanish said to only +3s. The danger would be that people would just burn gear and sell the loom points. If it cost 750k to get 3 points and you sell each point for 600k you have a pretty massive profit. I think it would have to be about 400k per loom point, so around 1.2m. That would still be good though. It would still burn a fat whole in the over all money supply, much faster than the tax will.
How you ask? Well people would be throwing shit loads of money into a black hole, individual millionaires would get richer for a short period before the market crashed as a huge surplus of loom points sat in the market doing nothing. Also it would for a short time create a lot of movement in the market, people would by up all the cheap shit +3s to burn into points to make new exciting gear.
Also +3 Elders Torch is a sacred object Meow, not POS.