Disappearance of wealth tax in Europe

The Globalization Institute is reporting that "Sweden plans to scrap wealth tax", referring to "a tax on people’s assets (this is in addition to an income tax)." Apparently, "Luxembourg and Spain remain the only other EU countries which impose such a tax. Denmark, Finland and the Netherlands have all dropped theirs in the past decade."

The author of the piece Alex Singleton, argues that "Sweden desperately needs to do something about the social problems caused by its stagnant economy. Much of Sweden’s tax regime is counterproductive. It has the highest tax burden in the EU, which discourages enterprise and encourages people like Ikea founder Ingvarf Kamprad to live elsewhere (he’s in Switzerland)."

I can appreciate that early in the twentieth century, when European countries were emerging from the class system where royalty and the nobility controlled most of the wealth due to their confiscatory activities of the previous centuries, that redistributing those assets through a wealth tax made sense. At this point, however, one of the primary sources of wealth is entrepreneurship and innovation. A wealth tax creates strong disincentives towards both of those things, or as Singleton succinctly puts it, "discourages enterprise." Plus it drives productive citizens to relocate to more tax-friendly jurisdictions.

Retaining entrepreneurial citizens will drive job growth and tax receipts as development of successful enterprises leads to tax revenue. It's nice to learn that European countries have realized this and jettisoned a confiscatory tax. To sum up: I agree with Singleton.