Oslo: Norway’s wealth tax, a hallmark of the nation’s commitment to social equality, is once again in the spotlight as rising levies on the ultra-rich prompt an increasing number of millionaires to leave the country. While critics argue that the policy risks economic stagnation and capital flight, the government remains steadfast, emphasizing that the preservation of equality outweighs the departure of a few wealthy individuals.
The wealth tax, first introduced in 1892, applies a 1% rate on net wealth between 1.76 million and 20.7 million kroner, and 1.1% on assets above this threshold. Despite the seemingly high rates, Norway allows significant deductions. Primary residences are assessed at just 25% of their market value, while shares and commercial property are calculated at 20%. Assets held abroad are also included in the tax base, though debt deductions are permitted, reflecting a system designed to balance fairness with practical economic considerations.
In recent years, the government has strengthened measures to discourage wealthy residents from leaving, including a steep exit tax of 37.8% on unrealized capital gains above 3 million kroner. Despite this, the exodus continues. According to the Civita think tank, 261 high-net-worth individuals with assets exceeding 10 million kroner left Norway in 2022, and 254 followed in 2023, more than doubling the pre-tax hike rate. Among Norway’s 400 wealthiest people, over 100 now live abroad or have shifted their wealth to family members overseas, highlighting the tension between fiscal policy and individual mobility.
Supporters of the wealth tax argue that it is essential for maintaining Norway’s high level of social equality, particularly after the abolition of inheritance tax in 2014. The tax contributes roughly 0.6% of the nation’s GDP, a significant source of revenue that supports public services without over-reliance on Norway’s oil-funded sovereign wealth fund. By taxing capital, the government maintains a progressive tax system that balances the burden across income and wealth, ensuring that those with the broadest financial resources contribute their share to society.
However, critics warn that the policy may undermine entrepreneurship and long-term economic growth. Approximately 40% of emigrants leaving due to the wealth tax are business owners, and studies suggest that their departure could lead to a 1.3% decline in Norway’s economic output. Startups and small enterprises, in particular, face challenges, as founders must pay taxes on capital that has yet to generate profits. Additionally, the higher cost of capital could reduce Norway’s competitiveness in the global market, discouraging investment and innovation.
Norway’s experience remains unique globally. While countries like France briefly considered higher wealth taxes and the UK debates the idea politically, few nations possess the combination of social cohesion, historical acceptance of high taxation, and sovereign wealth reserves that make Norway’s approach viable. The policy is deeply entwined with Norwegian values, aiming to distribute resources fairly and limit excessive inequality while maintaining public support for the welfare system.
The wealth tax became a key point of contention in Norway’s September 2025 elections, aiding the return of the Labour Party to power. The new government has affirmed that the tax will remain, viewing it as a cornerstone of fiscal fairness. Public opinion largely supports this stance, with recent polls indicating that 39% of Norwegians favor keeping or increasing the tax, while only 28% advocate its abolition.
Ultimately, Norway’s wealth tax illustrates the delicate trade-off between attracting and retaining the ultra-wealthy and preserving a society built on equality. While some millionaires may leave, the policy ensures continued revenue for public services, reduces extreme wealth disparities, and reinforces a societal model that prioritizes collective well-being over individual accumulation. The Norwegian experiment raises a broader question for the world: how far should nations go to maintain equality, and what are the costs they are willing to accept.