Lefties Argue Billionaires Shouldn’t Exist. Now, in Norway, They Won’t.


In case your web wealth is roughly $135,000 or extra and you reside in Norway, you have lengthy been topic to a 0.85 p.c wealth tax. That price has, as of this 12 months, been hiked to 1.1 p.c by the center-left authorities, and much more gobs of money will probably be taken from wealthy folks value roughly $1.8 million, who will probably be taxed at a price of 1.3 p.c.

Sadly for the Norwegian lefties—and their American counterparts who argue for comparable taxes to be instituted right here—this wealth tax hasn’t actually generated the income they’d anticipated. It has as an alternative resulted in wealthy folks boarding their superyachts and leaving these fjords behind forevermore.

Per the Norwegian newspaper Dagens Næringsliv, 30 of the nation’s multimillionaires and billionaires left the nation final 12 months upfront of the wealth tax hike. “This was greater than the whole variety of super-rich individuals who left the nation in the course of the earlier 13 years, it added,” famous The Guardian. “Much more super-rich people are anticipated to go away this 12 months due to the rise in wealth tax in November, costing the federal government tens of tens of millions in misplaced tax receipts.”

The analysis division for Statistics Norway admits the identical in a 2021 paper: “The tax income from wealth taxation is modest, solely roughly 15 billion NOK per 12 months, which corresponds to round 1.1 p.c of the whole tax income and 0.4 p.c of GDP.” (Different gems: “The richest Scandinavians preserve a considerable a part of their wealth in offshore tax havens. The wealth of the highest 0.01 of Norwegian households will increase by about 25 p.c if offshore wealth is included.”)

Many have moved to Switzerland, taking a leaf out of the guide of not too long ago deceased music legend Tina Turner, who by no means formally gave up her U.S. citizenship, in all probability to keep away from having to fork over the hefty exit tax (a 23.8 p.c on worldwide belongings) our personal nation imposes. Norway’s most-taxed particular person, billionaire Kjell Inge Røkke, not too long ago moved to Lugano, costing Norway the equal of virtually $16 million in misplaced tax income yearly. Since 2008, Dagens Næringsliv estimated that Røkke has been compelled to cough up the equal of $135 million. One other billionaire, Tord Ueland Kolstad, who simply moved to Lucerne, mournfully informed the Norwegian broadcaster TV 2: “This was not what I needed, however the toughened and elevated tax guidelines of the present authorities signifies that I, because the founder and accountable proprietor, don’t have any alternative.”

In different phrases, wealth taxes work precisely as libertarians warned: They generate far much less income than anticipated and end result within the ultra-rich hopping to fairer locales that do not see them as money cows to exploit.

As for our personal expats, like Turner, in the event that they have not given up their U.S. citizenship, they’re hit with privacy-eroding necessities just like the International Account Tax Compliance Act (FATCA), which forces overseas banks to report back to the U.S. authorities belongings held by Individuals. Expats from this nation additionally get hit twice by the taxman: as soon as by the federal government of their nation of residence, and as soon as by the U.S. authorities, in a transfer that’s out of step with how most different locations deal with their deserters. It is no surprise a high-net-worth particular person like Turner by no means formally renounced her U.S. citizenship however took Swiss citizenship with the “intent to lose her U.S. citizenship,” seemingly to keep away from the exit tax.

Whether or not it is wealth or exit taxes, FATCA or different intrusions, folks behave in predictable methods no matter the place they had been born: They have an inclination to wish to protect each their cash and privateness to the fullest extent attainable.

Norway’s studying that the laborious method.