Wealth Taxes in Europe

December 17, 2020

Net wealth taxes are recurrent taxes on an individual’s wealth, net of debt. The concept of a net wealth tax is similar to a real property tax. But instead of only taxing real estate, it covers all wealth an individual owns. As today’s map shows, only three European countries covered levy a net wealth tax, namely Norway, Spain, and Switzerland. France and Italy levy wealth taxes on selected assets but not on an individual’s net wealth per se.

Wealth taxes in Europe, 2020. European countries with a wealth tax, net wealth tax, wealth tax on selected assets

Net Wealth Taxes

Norway levies a net wealth tax of 0.85 percent on individuals’ wealth stocks exceeding NOK1.5 million (€152,000 or US $170,000), with 0.7 percent going to municipalities and 0.15 percent to the central government. Norway’s net wealth tax dates to 1892. Under COVID-19-related measures, individual business owners and shareholders who realize a loss in 2020 are eligible for a one-year deferred payment of the wealth tax.

Spain’s net wealth tax is a progressive tax ranging from 0.2 percent to 3.75 percent on wealth stocks above €700,000 ($784,000; lower in some regions), with rates varying substantially across Spain’s autonomous regions (Madrid offers a 100 percent relief). Spanish residents are subject to the tax on a worldwide basis while nonresidents pay the tax only on assets located in Spain.

Switzerland levies its net wealth tax at the cantonal level and covers worldwide assets (except real estate and permanent establishments located abroad). The tax rates and allowances vary significantly across cantons. The Swiss net wealth tax was first implemented in 1840.

Wealth Taxes on Selected Assets

France abolished its net wealth tax in 2018 and replaced it that year with a real estate wealth tax. French tax residents whose net worldwide real estate assets are valued at or above €1.3 million ($1.5 million) are subject to the tax, as well as non-French tax residents whose net real estate assets located in France are valued at or above €1.3 million. Depending on the net value of the real estate assets, the tax rate is as much as 1.5 percent.

Italy taxes financial assets held abroad without Italian intermediaries by individual resident taxpayers at 0.2 percent. In addition, real estate properties held abroad by Italian tax residents are taxed at 0.76 percent.

Net Wealth Taxes and Wealth Taxes on Selected Assets in European OECD Countries, 2020
Country ISO-2 Net Wealth Tax Wealth Tax on Certain Assets
Austria AT    
Belgium BE    
Czech Republic CZ    
Denmark DK    
Estonia EE    
Finland FI    
France FR   Yes
Germany DE    
Greece GR    
Hungary HU    
Iceland IS    
Ireland IE    
Italy IT   Yes
Latvia LV    
Lithuania LT    
Luxembourg LU    
Netherlands NL    
Norway NO Yes  
Poland PL    
Portugal PT    
Slovakia SK    
Slovenia SI    
Spain ES Yes  
Sweden SE    
Switzerland CH Yes  
Turkey TR    
United Kingdom GB    

Note: While net wealth taxes are levied on all wealth an individual owns (net of debt), wealth taxes on selected assets cover only part of an individual’s wealth (e.g., financial assets).

Source: EY, “Worldwide Estate and Inheritance Tax Guide 2020″ and Bloomberg Tax, “Country Guides.”

Was this page helpful to you?

No

Thank You!

The Tax Foundation works hard to provide insightful tax policy analysis. Our work depends on support from members of the public like you. Would you consider contributing to our work?

Contribute to the Tax Foundation

Related Articles

A wealth tax is imposed on an individual’s net wealth, or the market value of their total owned assets minus liabilities. A wealth tax can be narrowly or widely defined, and depending on the definition of wealth, the base for a wealth tax can vary.

A progressive tax is one where the average tax burden increases with income. High-income families pay a disproportionate share of the tax burden, while low- and middle-income taxpayers shoulder a relatively small tax burden.

An inheritance tax is levied upon an individual’s estate at death or upon the assets transferred from the decedent’s estate to their heirs. Unlike estate taxes, inheritance tax exemptions apply to the size of the gift rather than the size of the estate.