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Spain's Impuesto Temporal de Solidaridad de las Grandes Fortunas (ITSGF) — introduced in 2023 to tax net wealth above €3 million at 1.7-3.5% regardless of regional bonificaciones — represents a landmark centralisation of wealth taxation that directly overrides regional tax competition, particularly targeting Madrid and Andalusia which had offered 100% IP exemptions to attract wealthy residents, and is currently subject to an ongoing constitutional challenge at the Tribunal Constitucional
ITSGF mechanics: introduced by national Ley 38/2022; applies to individuals with net wealth above €3,000,000 (personal exemption deducted first: €700,000 general + €300,000 habitual residence); rate: 1.7% on €3m-€5m; 2.1% on €5m-€10m; 3.5% above €10m. Credit mechanism: any IP (regional wealth tax) paid can be credited against ITSGF — only net difference payable. Who it targets: the approximately 12,000-15,000 Spanish individuals with net wealth above €3m who were in regions with 0% IP (Madrid, Andalusia, Galicia, Cantabria). Revenue estimate: approximately €1.5bn/year additional revenue. Constitutional challenge: 8 autonomous communities filed an amparo (constitutional appeal) with the Tribunal Constitucional, arguing the ITSGF violates regional autonomy (communities have competence over IP) and the principle of tax residency. 2024: TC admitted the cases for consideration; ruling expected 2025-2026 — outcome will determine whether ITSGF survives. Political dimension: the ITSGF was pushed by the PSOE-Sumar coalition government as a 'solidarity levy on great fortunes'; Partido Popular and the affected autonomous communities oppose it. The IP/ITSGF system now creates the most complex regional wealth tax landscape in Europe.
Source: Ley 38/2022 ITSGF; AEAT ITSGF technical guide; Tribunal Constitucional recurso autonomous communities 2024; Asociación Española de Asesores Fiscales ITSGF analysis; El Confidencial ITSGF reporting
Norway's Formuesskatt (wealth tax) at 1.0-1.1% is the most comprehensive remaining OECD wealth tax — applying to all net assets above NOK 1,700,000 (approximately €150,000) — and has become increasingly controversial as Norwegian billionaires have publicly relocated to Switzerland, Zug in particular, citing the Formuesskatt as their primary reason, creating a high-profile emigration phenomenon that has influenced the global debate on wealth taxes and their capital flight consequences
Norwegian Formuesskatt structure: threshold NOK 1,700,000 (approximately €150,000) per person (doubled for married couples); rate 1.0% on net wealth up to NOK 20,000,000; 1.1% above. Asset valuation: listed shares at market value; unlisted shares at 75-80% of equity value (discounted to reduce penalty on private business); property at tax value (typically 25-30% of market value for primary residence). Norwegian wealth tax emigrations: 2022-2025: approximately 30-50 Norwegian billionaires publicly relocated to Switzerland — most frequently to Zug canton (Vermögenssteuer approximately 0.1-0.2%). Notable examples: Kjell Inge Røkke (fishing/shipping magnate, net worth approximately NOK 19bn; relocated to Lugano Switzerland 2022); Øyvind Eriksen (CEO Aker, relocated 2022); multiple other shipping, offshore, and tech billionaires. Estimated annual Formuesskatt avoided by relocating: for a NOK 5bn fortune: 1.0% × NOK 5bn = NOK 50m/year = approximately €4.5m/year — a compelling financial case for relocation. Government response: Norway tightened exit rules (5-year minimum residence abroad required to fully escape Formuesskatt liability); also proposed reducing shareholder income tax rates to reduce total owner burden. Capital flight debate: Norway's wealth tax emigrations have been cited by economists on both sides of the wealth tax debate — proponents argue the emigrants were outliers and the revenue is worth retaining; opponents argue it demonstrates real behavioral response to high wealth taxation.
Source: Skatteetaten Formuesskatt 2026 rates; NHO Norway wealth tax report 2024; VG Norway billionaire emigration reporting; Kjell Inge Røkke Zug relocation; Swiss Federal Tax Administration Zug Vermögenssteuer; OECD wealth tax discussion paper
The Netherlands Box 3 system — taxing a fictitious 6.04% yield on investment assets annually at 36% (effective 2.17% wealth tax equivalent) — is currently in constitutional crisis following the 2021 Hoge Raad 'kerstarrest' ruling that the system violates property rights for taxpayers whose actual return is lower than the fictitious yield, with the government racing to implement a reform to 'actual return' taxation by 2027-2028 that will fundamentally change the economics of Dutch investment and rental property holding
Box 3 constitutional crisis timeline: 2021-12-24 (Christmas ruling / kerstarrest): Hoge Raad ruled that Box 3 violates Article 1 Protocol 1 ECHR (right to peaceful enjoyment of property) for taxpayers whose actual return on assets was materially lower than the fictitious yield assumed by the law. Tax years 2017-2022: taxpayers who filed objections are entitled to refunds (approximately €2.8bn total refund obligation). Government response: introduction of a temporary 'actual return' calculation for 2023-2026 as a transitional measure; development of a structural reform bill (Box 3 Werkelijk Rendement) for implementation from 2027. What Box 3 reform means: instead of taxing a fictitious 6.04% on asset value, the new system will tax actual income (dividends, interest, rental income) plus actual capital gains (on disposal). This has profound implications: property investors currently taxed at 2.17% of property value regardless of actual rent will be taxed on actual net rental income (could be higher or lower); stock/fund investors currently taxed at 2.17% of portfolio value regardless of market movements will be taxed on actual dividends and realised capital gains; cryptocurrency holders will be taxed on actual crypto returns rather than fictitious yield. Dutch tax landscape post-reform: Netherlands will shift from a wealth tax equivalent (Box 3) to a more conventional capital income + capital gains regime — bringing it closer to the UK, German, and French models and potentially making the Netherlands more attractive for holding appreciating assets that generate little current income.
Source: Hoge Raad kerstarrest 24 december 2021; Staatsblad Box 3 overbruggingswetgeving 2022; Ministerie van Financien Box 3 hervormingsbrief 2024; Belastingdienst Box 3 actueel rendement; estimated €2.8bn refund obligation
Annual Wealth Tax Rate on €5m Net Assets by Country — Q1 2026 (%)
National tax authority rates 2026
📋 Reference Data
Wealth Tax Regimes by Country — Q1 2026
National tax authority schedules 2026
| Country | Tax | Threshold | Rate | Asset Base | Key Exemptions | Notes |
|---|---|---|---|---|---|---|
| Spain | Impuesto sobre el Patrimonio (IP) + ITSGF | €700.000 personal + €300.000 residence (IP); €3m (ITSGF) | IP: 0,2-3,5%; ITSGF: 1,7-3,5% | All net assets (IP); net wealth (ITSGF) | Habitual residence up to €300k; pension assets | Madrid: 100% IP bonificación but ITSGF applies >€3m; constitutional challenge |
| Norway | Formuesskatt | NOK 1.700.000 (about €150k) | 1,0% below NOK 20m; 1,1% above | Net assets: shares (75-80% unlisted); property (tax value) | Primary residence at 25% of market value; pension | Billionaire emigrations to CH; 5yr exit rule; NOK |
| Netherlands | Box 3 (fictitious yield) | €57.000 per person | 36% on 6,04% fictitious yield = about 2,17%/year of value | Financial assets, savings, investment property (not BV shares) | Heffingsvrij vermogen €57.000; pension assets; own home | Reform to actual return expected 2027; constitutional crisis ongoing |
| Switzerland | Vermögenssteuer (cantonal) | Cantonal threshold (varies; often CHF 50-200k) | about 0,1-0,8% depending on canton | All net assets (moveable + immoveable) | Personal deductions; pension assets | CHF; no federal wealth tax; Zug: about 0,1%; Geneva: about 0,7%; no Vermögenssteuer above federal level |
| France | IFI (Impôt sur la Fortune Immobilière) | €1.300.000 net real estate | 0,5-1,5% progressive | Real estate assets only (not financial) | 30% main residence discount; professional property | Replaced ISF in 2018; significant narrowing — financial assets excluded |
| Belgium | Taxe sur les comptes-titres | €1.000.000 (securities accounts) | 0,15% of account value | Securities (shares, bonds, funds) in accounts >€1m | Certain pension vehicles; registered shares | TCC; relatively low rate; applies to securities accounts exceeding €1m per account |
| Italy | IVIE + IVAFE | IVIE: property abroad; IVAFE: financial assets abroad | 0,76% (IVIE property); 0,2% (IVAFE financial) | Assets held abroad by Italian residents | Italian assets not subject (taxed other ways) | Italy taxes foreign assets differently; domestic property via IMU; not global wealth tax |
| Greece | ENFIA property tax | Varies by property value | 0,1-1,15% depending on value | Real estate (objective values) | Primary residence discount; low-value exemptions | Not pure wealth tax; property tax with graduated rates; revenue critical since crisis |
| Germany | No wealth tax | Abolished 1997 | 0% | N/A | N/A | Vermögensteuer abolished by BVerfG 1995 ruling; CDU-led government did not reinstate |
| United Kingdom | No wealth tax | N/A | 0% | N/A | N/A | No wealth tax; no property wealth tax beyond Council Tax (local); IHT on death only |
| Sweden | No wealth tax | Abolished 2007 | 0% | N/A | N/A | Förmögenhetsskatt abolished; political consensus not to reintroduce despite inequality debate |
| Denmark | No wealth tax | Abolished 1997 | 0% | N/A | N/A | Formueskat abolished; high income tax instead |
| Austria | No wealth tax | Abolished 1994 | 0% | N/A | N/A | Vermögensteuer abolished; no wealth tax at national or regional level |
| Finland | No wealth tax | Abolished 2006 | 0% | N/A | N/A | Varallisuusvero abolished; Finland among richest EU states without wealth tax |
| Luxembourg | Wealth tax (corporates) — individuals: none | Individual: no threshold | Individual: 0% | N/A for individuals | N/A | Corporate wealth tax applies to companies; individual wealth tax abolished 2006 |
ⓘ All EUR de-DE except Norway (NOK), Switzerland (CHF). The majority of European countries have ABOLISHED wealth taxes — Germany (1997), Denmark (1997), Finland (2006), Luxembourg (2006), Sweden (2007) being key examples. Countries that retain wealth tax: Spain (complex dual IP/ITSGF system), Norway (most comprehensive), Switzerland (cantonal only, low rates). Netherlands Box 3 is functionally equivalent to a wealth tax (annual levy on asset value) though technically a fictitious yield income tax. France IFI is a property-only wealth tax. Belgium's TCC (tax on securities accounts) is a narrow securities-account levy at very low rates. The abolition trend was driven by: evidence of capital flight; administrative complexity (valuing unlisted assets); constitutional challenges (Germany BVerfG 1995 ruled existing Vermögensteuer violated constitutional equality — different valuation rules for real estate versus other assets); EU free movement creating competition for mobile capital.
Spain Wealth Tax — ITSGF vs IP by Region Q1 2026
AEAT ITSGF + autonomous community IP rates Q1 2026
| Region | IP Bonificación | Effective IP Rate | ITSGF Applies? | Combined Rate (>€3m wealth) | Notes |
|---|---|---|---|---|---|
| Madrid | 100% — IP effectively 0% | 0% | Yes — ITSGF applies | 1,7-3,5% (ITSGF only) | ITSGF was specifically designed to catch Madrid's 0% IP beneficiaries |
| Andalusia | 100% — IP effectively 0% | 0% | Yes — ITSGF applies | 1,7-3,5% (ITSGF only) | Second major 0% IP community; ITSGF applicable |
| Galicia | 100% — IP effectively 0% | 0% | Yes | 1,7-3,5% | Joined 0% IP community 2022 |
| Cantabria | 100% — IP effectively 0% | 0% | Yes | 1,7-3,5% | 0% IP since 2019; ITSGF applies |
| Catalonia | Standard national scale | 0,21-2,75% | Yes — but IP credited | 1,7-3,5% (ITSGF less IP paid) | Only net difference payable; IP credit mechanism applies |
| Basque Country | Foral regime (own IP) | 0,2-2,5% (foral) | Debated — Basque foral exemption argued | Unclear — constitutional dispute | Basque foral communities claim ITSGF doesn't apply; pending resolution |
| Valencia | Standard + 0% local bond | 0% | Yes | 1,7-3,5% | Valencia offered 0% IP; ITSGF applies |
| Murcia | 50% bonificación | about 0,1-1,25% | Yes — IP credited | Net difference only | Partial IP reduction; ITSGF tops up |
| Aragon | Standard national scale | 0,2-3,5% | Yes — IP credited | ITSGF less IP; net difference only | Full IP applies; ITSGF credit reduces overlap |
ⓘ The ITSGF was specifically designed to prevent wealthy individuals in regions with 0% IP (particularly Madrid) from having zero wealth tax — it acts as a federal backstop. The constitutional challenge (recurso de inconstitucionalidad) is pending at the Tribunal Constitucional — if the TC rules the ITSGF unconstitutional, regions with 0% IP would again have genuine zero wealth tax on fortunes above €1m. If the TC upholds it, the dual IP/ITSGF system becomes permanent and Madrid's competitive advantage as a 0% wealth tax region disappears for fortunes above €3m. Basque Country and Navarre have special foral (charter) regimes with more autonomy — whether ITSGF applies to them is separately disputed. For Spain's ultra-high-net-worth residents: pre-ITSGF, Madrid offered complete wealth tax freedom; post-ITSGF (if upheld), wealth above €3m faces 1.7-3.5% annually — making Switzerland (0.1-0.8%) and Monaco (zero) increasingly attractive for those with high mobility.
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🔬 Methodology & Sources
Wealth Tax Methodology
A wealth tax is an annual tax levied on the net value of assets owned by an individual (assets minus debts). Unlike income tax (on flows) or capital gains tax (on realised gains), a wealth tax requires annual payment from the stock of accumulated wealth — even if no income or gains are generated. Most European wealth taxes were abolished in the 1990s-2000s (Germany 1997, Sweden 2007, Finland 1994, Denmark 1997, Luxembourg 2006) due to capital flight, administrative complexity, and constitutional challenges. Remaining wealth taxes: Spain (IP + ITSGF); Norway (Formuesskatt); Switzerland (Vermögenssteuer — cantonal only); Netherlands (Box 3 — functionally similar); France (IFI — property only). All EUR de-DE; Norwegian NOK; Swiss CHF.
Formula
Annual_wealth_tax = (net_assets - threshold) × rate | Effective_burden = wealth_tax / income × 100 | NL_Box3 = net_assets × 6.04% fictitious_yield × 36%
CitationSpanish Ley 19/1991 IP; ITSGF 2022 reform; Norwegian skatteloven formuesskatt; Swiss DBG/StHG Vermögenssteuer; French CGI IFI.
❓ Frequently Asked Questions
As of 2026, the main European countries with genuine wealth taxes are: Spain — Impuesto sobre el Patrimonio (0.2-3.5% above €700,000 personal exemption) plus the ITSGF (1.7-3.5% above €3m) introduced in 2023; Norway — Formuesskatt (1.0-1.1% above NOK 1,700,000, approximately €150,000); Switzerland — Vermögenssteuer (cantonal only, 0.1-0.8%, varies significantly by canton). Netherlands — Box 3 is functionally a wealth tax equivalent (effective approximately 2.17% of asset value annually); France — IFI (0.5-1.5% on real estate only above €1.3m). Most European countries abolished wealth taxes: Germany (1997), Denmark (1997), Finland (2006), Luxembourg (2006), Sweden (2007) — all driven by capital flight concerns and administrative complexity.
The Impuesto Temporal de Solidaridad de las Grandes Fortunas (ITSGF) is a national wealth tax introduced by Spain's central government in 2023, targeting individuals with net wealth above €3 million. Rate: 1.7% on €3m-€5m; 2.1% on €5m-€10m; 3.5% above €10m. It was specifically designed to counteract regions like Madrid and Andalusia that had set their regional IP (Impuesto sobre el Patrimonio) to 0% — effectively eliminating wealth tax for wealthy residents. The ITSGF acts as a federal backstop: any regional IP paid is credited against the ITSGF, so only the net difference is payable. Example: wealthy Madrilenian (0% IP) with €8m net wealth: ITSGF = approximately €136,500/year. Constitutional challenge: 8 autonomous communities have challenged the ITSGF at the Tribunal Constitucional as violating regional autonomy — ruling expected 2025-2026.
Norway's Formuesskatt charges 1.0% annually on net assets above NOK 1,700,000 (approximately €150,000). For a billionaire with NOK 5,000,000,000 (approximately €450m) in assets: annual Formuesskatt = approximately NOK 50,000,000 (approximately €4.5m/year). Over 10 years (discounted): approximately €35-40m lifetime tax burden. By relocating to Switzerland (Zug canton: Vermögenssteuer approximately 0.1%): annual Swiss tax approximately €450,000 — saving approximately €4m/year. In 2022-2025, approximately 30-50 Norwegian billionaires publicly announced relocations primarily to Switzerland, citing the Formuesskatt. Norway responded: requiring 5 years of genuine foreign residency before the Formuesskatt obligation fully ends (previously 1-2 years was sufficient). The debate continues: Norwegian government argues the revenue funds valuable public services; critics argue the emigrations destroy more tax revenue long-term (the relocated individuals also stop paying Norwegian income tax, capital gains tax, and inheritance tax).
The Netherlands Box 3 (savings and investments) taxes an assumed 6.04% annual return on your net assets — then charges 36% tax on that assumed return. Effective annual charge: 6.04% × 36% = approximately 2.17% of asset value per year, regardless of your actual income or gains. Box 3 assets: savings accounts, investment portfolios, rental property (not your main home), crypto, foreign assets. Exempt: pension assets, own home (Box 1), and first €57,000 per person is heffingsvrij (exempt). Unlike a traditional wealth tax, Box 3 is technically an income tax on fictitious income — but economically, it functions identically to a 2.17% annual wealth tax. Box 3 reform: following a Constitutional Court ruling in 2021 (kerstarrest) that Box 3 violates property rights for taxpayers whose actual return is below the fictitious yield, the Netherlands is reforming Box 3 to tax actual returns from 2027-2028 — making it a conventional capital income + gains tax.
European countries abolished wealth taxes primarily due to three interconnected problems: capital flight — as wealthy individuals moved assets to jurisdictions without wealth taxes; in Germany, billions in assets moved to Luxembourg, Switzerland, and Austria before abolition in 1997; in Sweden, an estimated SEK 500bn left the country before abolition in 2007; administrative complexity — valuing illiquid assets (unlisted company shares, real estate, art, private equity) consistently and fairly proved very difficult; different valuation methods created inequity between asset classes (Germany's BVerfG ruled exactly this violated constitutional equality in 1995); poor revenue yield — annual revenue from wealth taxes was typically small relative to the economic distortions caused; Germany's Vermögensteuer raised approximately €4-5bn/year before abolition versus GDP of approximately €2,000bn — 0.2% of GDP; insufficient to justify the compliance burden and capital flight. Economic evidence since: OECD analysis suggests wealth taxes work best when combined with strong capital controls — in the free capital movement EU, wealth taxes face structural leakage that limits their revenue effectiveness. The Norwegian experience (billionaire emigrations to Switzerland) has reinvigorated this debate in 2022-2025.
Sources & References
Data sourced from official institutional publications. Results are for informational purposes only. Last reviewed Jan 2026.
Data Disclaimer
Wealth tax rules are complex and subject to constitutional challenge. Rates and thresholds shown are Q1 2026 — some are under judicial review. Always consult a specialist adviser for asset planning.
Wealth tax rules are complex and subject to constitutional challenge. Rates and thresholds shown are Q1 2026 — some are under judicial review. Always consult a specialist adviser for asset planning.