Wealth taxes are a hot topic in policy debates from Europe to the U.S., and Norway offers one of the most instructive examples. The Nordic nation has been taxing personal fortunes since 1892, and while the levy has prompted some millionaires to leave, it continues to generate meaningful revenue and support one of the world's most equal societies.
Millionaires on the Move
Norway's wealth tax is structured to be progressive. Individuals pay 1% on net wealth between 1.76 million and 20.7 million Norwegian kroner ($174,000–$2 million), and 1.1% on assets above that, according to the Norwegian Tax Administration. Main homes receive a 75% discount, shares and commercial property 20%, and debts are deductible. In 2023, roughly 671,639 people — about 12% of Norway's population — paid the tax, according to Reuters.
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Yet, higher levies and stricter exit rules introduced in recent years have pushed some wealthy Norwegians abroad. Data from liberal think-tank Civita, cited by Reuters, reports that 261 residents with assets above 10 million kroner left in 2022, and 254 in 2023 — more than double pre-hike levels. Entrepreneurs and business owners make up a significant portion of these departures.
Leaving Norway triggers a 37.8% exit tax on unrealized capital gains over 3 million kroner, a measure tightened in 2024 to prevent tax deferral loopholes, according to BDO, an international advisory and auditing firm in Norway.
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Funding Equality
Supporters argue the wealth tax helps fund public services and maintain social equality. Norway has no inheritance tax since 2014, and proceeds from its oil and gas industry go into a sovereign wealth fund, capped at 3% annual withdrawals, Reuters reports. The wealth tax, therefore, ensures a more progressive personal tax system, with revenue now representing 0.6% of GDP — a significant sum for a country of just 5.6 million people.
Data from Norway's statistics office shows that entrepreneurs can generally meet the tax obligations, and that the burden falls largely on the richest households. Reuters reports the tax may even encourage investment in education and skills, and the country still ranks highly for business ease.
Costs for Startups and Capital
Critics point to potential downsides. “The wealth tax system makes it harder for companies to compete with the rest of the world,” Knut-Erik Karlsen, who recently left Norway for Switzerland after making his fortune in fish oil supplements, told Reuters.
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Princeton University researcher Christine Blandhol told Reuters that around 40% of emigrants are business owners, and she estimates the latest tax changes could reduce Norway's long-term economic output by 1.3%. High taxes on wealth and labor also contrast sharply with countries like Switzerland, where similar emigrants often relocate.
Lessons for Other Countries
Norway's model is difficult to replicate. Its oil wealth and social cohesion help cushion the economic impact. Other countries, including France, Britain, and Italy, have avoided broad wealth taxes or settled for narrower, targeted measures, Reuters reported. Economists agree that such levies involve trade-offs: reducing inequality comes at the cost of some capital leaving the country and potentially dampening entrepreneurship.
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