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Norway’s Wealth Tax Is Backfiring

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Re: Norway’s Wealth Tax Is Backfiring

#11
post #4

> wealthy Norwegians took with them a total fortune of $54 billion when they left. This means that the wealth tax, which was projected to increase revenue by nearly $150 million annually, will result in about 40 percent less revenue than it currently generates So the problem is revenue from wealth tax will only be $90M instead of $150M? As opposed to $0M without the wealth tax? How does having these billionaires phys…

If anything, it seems that improving the weak controls against capital flight is all it would take to correct this problem.

That would work. But it’s a terrifying worldview that citizens should be vassals to the state instead of the other way around.

Re: Norway’s Wealth Tax Is Backfiring

#12
post #5

Doesn't really matter as America can go after funds regardless of where you move to. Just pay your fucking taxes, you got the benefits of the system, pay back into it.

The article isn't about income taxes. Income taxes are taxes on income that you earn in any calendar year. The article is about wealth taxes. In addition to income taxes, Norway has a wealth tax, which taxes net wealth above $170k (NOK 1.7M) at 1% [0]. So, if your net wealth is $200k, you are taxed 1% on $30k every year. Separately, it is a myth that the wealthy don't pay taxes. This isn't Reddit. Wealthy pay taxes b…

Ironically, America does have a wealth tax if you want to relinquish your citizenship. I don't think Norway does, and many rich Scandinavians change citizenship to Switzerland negotiating their taxes straight with the canton they move to (like the founder of Ikea did). It is easier for a Norwegian to optimize their taxes than an American (since America also taxes worldwide income, and you can't just change your citizenship without paying a penalty).

Re: Norway’s Wealth Tax Is Backfiring

#13
post #5

Earlier quoted context omitted.

The article isn't about income taxes. Income taxes are taxes on income that you earn in any calendar year. The article is about wealth taxes. In addition to income taxes, Norway has a wealth tax, which taxes net wealth above $170k (NOK 1.7M) at 1% [0]. So, if your net wealth is $200k, you are taxed 1% on $30k every year. Separately, it is a myth that the wealthy don't pay taxes. This isn't Reddit. Wealthy pay taxes b…

Ironically, America does have a wealth tax if you want to relinquish your citizenship. I don't think Norway does, and many rich Scandinavians change citizenship to Switzerland negotiating their taxes straight with the canton they move to (like the founder of Ikea did). It is easier for a Norwegian to optimize their taxes than an American (since America also taxes worldwide income, and you can't just change your citiz…

Presumably they don’t need to change their citizenship, they just become tax resident in another country. Most countries only tax residents. Norway is part of the EEA so its citizens have the right to live in Switzerland.

Re: Norway’s Wealth Tax Is Backfiring

#14

Doesn't really matter as America can go after funds regardless of where you move to. Just pay your fucking taxes, you got the benefits of the system, pay back into it.

> you got the benefits of the system, pay back into it

The "system" isn't the government, though it's easy to muddle that line, considering some developed countries have government spending that's over half of the GDP (with Norway sitting at around a fifth as of 2021); and the existence of a government that facilitates the "system", which is in reality the private activities of the people, does not make it that without that particular government the system will not exist at all.

Imagine a parent who tells a fully-grown child well into his adulthood that they have an ever-increasing claim on what the child produces by virtue of having given birth to and raised him. Does that not sound abusive? That's not the kind of relationship I want with my government. The government, or at least the American one, is meant to serve the people, not rule over them and allow the people to keep whatever scraps the government allows them to keep.

Every time you perform a service for somebody or make a widget for somebody -- basically any economic activity -- you are paying back into the system by fulfilling a demand that someone else has. And not just remunerative efforts: every time you pick up a cigarette butt off the street that you didn't smoke, or every time you watch someone else's kid for a night, or you volunteer at a local soup kitchen. Those are all ways that people pay back into the system.

Let's not make the mistake of thinking taxation is the only way, or even the most important and effective way. Many roles that are currently performed by government funded via taxation have only been that way very recently in human history, and I'm in no way convinced that this is either optimum or necessary.

Re: Norway’s Wealth Tax Is Backfiring

#15

Doesn't really matter as America can go after funds regardless of where you move to. Just pay your fucking taxes, you got the benefits of the system, pay back into it.

How much benefit does someone get and how much should they pay back in?

These are reasonable questions.

Re: Norway’s Wealth Tax Is Backfiring

#16

Earlier quoted context omitted.

If anything, it seems that improving the weak controls against capital flight is all it would take to correct this problem.

That would work. But it’s a terrifying worldview that citizens should be vassals to the state instead of the other way around.

How so?

Capital flight is a form of class warfare. Controls against it are the majority, workers who don’t own capital, enforcing a social contract against those who do.

Of course, that will only happen in states where workers are in power. In most countries that isn’t the case and, unsurprisingly, there are weak capital flight controls.

Re: Norway’s Wealth Tax Is Backfiring

#17

Earlier quoted context omitted.

Ironically, America does have a wealth tax if you want to relinquish your citizenship. I don't think Norway does, and many rich Scandinavians change citizenship to Switzerland negotiating their taxes straight with the canton they move to (like the founder of Ikea did). It is easier for a Norwegian to optimize their taxes than an American (since America also taxes worldwide income, and you can't just change your citiz…

Presumably they don’t need to change their citizenship, they just become tax resident in another country. Most countries only tax residents. Norway is part of the EEA so its citizens have the right to live in Switzerland.

Ya, so it is even easier for Europeans. And it wouldn't matter if they were a part of the EEA or not, they would almost definitely negotiate their taxes with the canton of their residency as part of their move (you can easily buy residency in Switzerland). The EEA is more for normal people from the EU who want to work in Switzerland and pay normal taxes (which are still low for Europe).

Re: Norway’s Wealth Tax Is Backfiring

#18

But of course an institute called the "American Institute for Economic Research" is going to say that; from the about page, they believe in "the value of personal freedom, free enterprise, property rights, limited government, and sound money."

Do you not believe in the value of those things?

Separately, every institute or person that has published anything has an agenda; so the fact that this particular institute has a mission that you perceive to align with their words doesn't mean that their words are wrong. It is by definition an ad hominem fallacy.

Re: Norway’s Wealth Tax Is Backfiring

#19

Earlier quoted context omitted.

That would work. But it’s a terrifying worldview that citizens should be vassals to the state instead of the other way around.

How so? Capital flight is a form of class warfare. Controls against it are the majority, workers who don’t own capital, enforcing a social contract against those who do. Of course, that will only happen in states where workers are in power. In most countries that isn’t the case and, unsurprisingly, there are weak capital flight controls.

Almost every country with significant capital controls are ones you likely wouldn't want to voluntarily move to.

Re: Norway’s Wealth Tax Is Backfiring

#20
post #4

> wealthy Norwegians took with them a total fortune of $54 billion when they left. This means that the wealth tax, which was projected to increase revenue by nearly $150 million annually, will result in about 40 percent less revenue than it currently generates So the problem is revenue from wealth tax will only be $90M instead of $150M? As opposed to $0M without the wealth tax? How does having these billionaires phys…

If anything, it seems that improving the weak controls against capital flight is all it would take to correct this problem.

Norway is part of the EEA which means that there is free movement of people and capital. Therefore it is impossible for them to prevent people leaving to other EEA countries. Changing the EEAs 4 freedoms is unlikely.
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