Class-warfare tax policy is bad news.
Last year, I warned that, “rich people are not sheep, patiently waiting to be sheared. If their fiscal torture is too extreme, they will leave.”
Norway is a powerful example. Here’s a chart showing the rate at which Norwegians are moving to Switzerland.
You may be wondering what caused the sudden change after 2022.
The above chart comes from a Bloomberg report by Ott Ummelas, and he explains what happened after Norway “increased the wealth tax burden by 55%.”
Steep increases in wealth and dividend taxes by Norway’s left-leaning government have prompted dozens of the Nordic nation’s rich to move to another prosperous, mountainous country to the south. …the small but significant migration by wealthy entrepreneurs could become permanent, bolstering Switzerland’s status as a low-tax haven. …Eighty-two rich Norwegians with a combined net wealth of about 46 billion kroner ($4.3 billion) left the country in 2022-2023, with 34 moving out last year alone, according to data from the Finance Ministry. More than 70 of those have moved to Switzerland… Swiss taxation varies by canton, but the overall effect is a significantly lower percentage of wealth and income than most other European nations. …Hollup said…”it’s a two-fold issue of losing tax revenue for Norway and the risk that a lot of brain capital has left the country.”
I started today’s column by observing that rich people are not sheep.
Instead, they are geese. Or, to be more specific, they are golden geese that have flown away.
P.S. This is primarily a column about misguided wealth taxation by Norway. But tax competition produces winners and losers, so this is also a story about the economic success of Switzerland.
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