Only one of 27 countries European Union count with one wealth tax network (after deducting debts) individual people: Spain. The rest of the community partners either didn’t have it or have eliminated it in recent years. In fact, it is a very unique tax and can only be compared to those that exist in Turkey. Norway and SwitzerlandAlthough it is the country with the highest rates. Experts such as Valentí Pich, president of the General Council of the Colleges of Economists, see it as a “mortally wounded” tribute. Juan Corona, Professor of Public Finance at Abat Oliva University and Jean Monet Professor of European Financial Integration, highlights its uniqueness from a comparative perspective.
Both attended a conference dedicated to analyzing this tax figure, which became more common after the 70s and 80s of the last century. There are other countries that impose taxes in addition to the personal tax on the assets of Spain, Switzerland and Norway. certain assetsNot all wealth, according to data from EY consulting firm. Corona points out that in France or Sweden this tax was abolished for “technical” reasons, not “political demagogy”.
In Sweden, it was based on the reasons: equality, efficiency and competence. In the first case, they concluded: double taxationthat is, that a property is taxed, consisting of, among others, financial or real estate income that is taxed with personal income tax or other taxes, confirms this professor who specializes in taxation.
In terms of efficiency, they found that tribute turned into a tax in Sweden. savingso about investment, something that is not exactly optimal today. In terms of adequacy, it has been seen that the collection obtained does not justify the existence of such a tax. It also warns that the tax encourages the public. offshore.
The experts who created White Paper on Tax Reform appointed by the Minister of Finance, Maria Jesus Monterostressed that there are countries that have lower rates than Spain but collect more for this tax. This is the case of Luxembourg, which only taxes companies and collects more than 7% of total taxes, and Switzerland, which has a collection percentage of over 4% of the total. It barely reaches 0.5% of the total collection in Spain and 1.5% in Norway. Spain has the highest rates, up to 3.75%, while other countries with lower taxes, fewer exemptions and deductions are entering more.
Spain
Taxpayers whose assets exceed €700,000 must pay a rate ranging from 0.2% to 3.75%, as this tax is redistributed (who has more pays more). Main residence up to 300.000 Euro is not taxed. Its management is the responsibility of autonomous communities, which can impose deductions or bonuses and make changes in rates from the exempt minimum. In fact, the exempt minimum amount was set in Aragon, where it was reduced to 400,000 euros; Community of Catalonia, Extremadura and Valencia (500,000). Lowering this threshold involves more filers. Andalusia recently launched a new tax war between communities by announcing that it will cut 100% of the quota, as Madrid has done for a decade; Galicia, which applies a 25% discount, will increase it to 50%. The tax, which was born in 1977 as an “extraordinary” tax, was reintroduced in 2011 to increase collections after the 2008 crisis. Between 2008 and 2010, the tax obligation was eliminated. Later, its validity was extended until it was permanently consolidated in the 2020 budgets with the General Government Budgets. Of the approximately 1,200 million collected across the country with the inheritance tax, only 0.5% of the total collection, more than half corresponds to Catalonia. In response to the autonomy strategy led by the PP, the Government envisages a new tax of temporary nature, called solidarity, for assets of three million in 2023 and 2024. It will be applied to the autonomies that are not sought in the inheritance tax.
Switzerland
The collection of wealth tax, called ‘Vermögenssteuer’ in Switzerland, varies by canton (regional division of the country) and is applied to some of the assets the owner may own in any country in the world. The tax was created in 1840 and gradually applied by all cantons until 1970. Taxable persons are natural persons. It is decentralized at the cantonal (regional) and municipal levels. There is a state harmonized regulation. Municipalities are authorized to collect taxes and may apply additional fees to the tribute of their canton. The minimum exemption amount varies between 65,000 and 185,000 Euros, depending on the canton, municipality and personal and family circumstances. Tax rates are staggered and vary considerably between cantons, but as a general rule they are relatively low progressive rates between 0.03% and 1.09%. With many exemptions and tax advantages, it collects 4% of the total taxes in the country annually.
Norway
A rate of 0.95% applies to assets exceeding $190,000 (approximately €195,000) in Norway. If they exceed $2.3 million (€2.4 million), the tax rate is 1.1%. The tax has been required since 1892. Taxpayers are real persons. There are two types of taxes: a national and a municipal one. The municipal rate is 0.7% and the national rate is 0.15%. There is no tax limit for this income-based tax. Installment payments are made four times a year. This tax represents approximately 1.5% of the country’s annual tax collection.
France
The so-called solidarity tax on wealth created in 1989 was abolished by the Government of Emmanuel Macron in 2018. This tax was replaced by the tax on real estate property (IFI). The rate applies if the net worth of real estate assets exceeds €1.3 million. This rate can go up to 1.5% depending on the value of these assets. It is a central tax, so there is no difference at the regional level. The passive subject of the tax is the house. The tax base includes all real estate as well as the rights that fall upon them, such as the shares of companies that own real estate. The fee varies between 0.5% and 1.5%. The latter is applied from a tax base of 10 million Euros. There is a reduction in the joint limit, and the total amount of income tax plus the IP of the real estate cannot exceed 75% of the taxpayer’s income from the previous year. The excess is deducted from the tax to be paid. With this tax, the French public coffers are only 0.2% of the total tax collection.
Italy
The current tax in Italy is 0.76% on property outside the country and 0.2% on financial investments. It has never been a stable tribute. However, in 1992, to reduce Italy’s public debt and meet the requirements of the Maastricht Treaty, it demanded a one-time ‘one-off’ tax of 0.6% of the value of current accounts, deposits, savings accounts, certificates in banks. deposits and interest bearing securities. Since 2012, there are two taxes on certain assets abroad of natural persons residing in Italy: tax on real estate abroad (0.76%) – with a regulation similar to the IBI in Italy – and in Italy tax on invested financial assets. (0.2%). The purpose of his entry was twofold: to generate the necessary additional income in the midst of an economic crisis and to combat tax evasion. The fact is that the revenue volume is practically a reference.
Belgium
Belgium imposed a tax of 0.15% on securities accounts that reached or exceeded one million euros at home and abroad in 2021. It replaced its predecessor, which was declared unconstitutional in October 2019 for violating the principle of equity, by not taxing all kinds of financial assets and taking into account that the average value of the securities accounts in the case of joint ownership is proportional. number of account holders. The tax is levied on securities accounts opened in Belgian or foreign financial institutions with an average value of more than 1,000,000 Euros. Both natural and legal persons are taxpayers. The tax rate is 0.15% on the average value of the securities account, including all financial assets (fixed income, variable income, derivatives, cash). This tax constitutes 0.5% of the total collection to the Italian coffers.