The national wealth tax, known as the formuesskatt, has become a focal point in Norway’s upcoming general election. As the country gears up for voting on Monday, the debate around whether to maintain, reduce, or eliminate this tax is intensifying, regardless of which party emerges victorious.
The tax currently generates around 32 billion kroner (£2.4 billion), a significant amount when scaled to a larger economy. Proponents argue that it is essential for promoting a progressive tax system and fostering economic equality. Conversely, many entrepreneurs are actively opposing the tax, launching lobbying efforts and funding campaigns. This opposition has even inspired cultural expressions, such as a protest song critical of the wealth tax.
Controversy has also affected academics; some experts have received threats and faced disinformation regarding their research on wealth taxation. This environment has made figures like Annette Alstadsæter, Director of the Skatterforsk Centre for Tax Research, cautious about public statements. Critics, including economists from various think tanks, assert that this tax puts Norwegian business owners at a disadvantage compared to foreign competitors.
In the political arena, the leader of the Labour party, Jens Stoltenberg, has proposed establishing a cross-party commission to review the tax system. His party currently leads in polls over the populist Progress Party, which aims to abolish the wealth tax. The centrist Høyre party also advocates for major reductions to the tax’s revenue.
Historically, Norway has imposed a wealth tax since 1892, and it applies to assets exceeding 1.7 million kroner (£125,000). Critics claim the tax has prompted the relocation of high-net-worth individuals from Norway. However, recent analyses indicate this exodus has not significantly impacted the economy. In 2023, approximately 720,000 residents paid the wealth tax, though only a fraction of the contributions come from the wealthiest individuals.
Discussions about the tax highlight a complex interplay between economic growth and public funding. Some argue that it helps support vital systems such as social security, while others call for reforms to its structure. As the election approaches, the future of the formuesskatt remains a contentious issue for both voters and policymakers in Norway.
Source: https://www.theguardian.com/world/2025/sep/07/wealth-tax-norway-election