WHAT EUROPE LEARNED FROM WEALTH TAXES — AND WHAT IT COULD MEAN FOR THE U.S. Research and opinion.

DOGE, Elon Musk’s budget assassination team, gutted decades old humanitarian agencies like U.S. A.I.D. and PEPFAR that saved lives across the world. DOGE and Trumps Big Beautiful Atrocity of a Budget Bill further cut important programs that assisted the vulnerable in the United States. We took a look, with the help of AI, how the wealthiest 1% of Americans could pay a fairer share of taxes to help the funding shortfall. Learning from past experiences in Europe, we see that a wealth tax holds promise in the U.S. if the Congress has the courage to hold the richest to help the poorest.

Spain: from patchwork to “solidarity”

Spain has long had a regional wealth tax (Impuesto sobre el Patrimonio), but several regions—most famously Madrid and Andalusia—granted 100% rebates, creating a patchwork where affluent residents could pay little or nothing. In late 2022, Madrid’s central government layered on a national “Solidarity Tax on Large Fortunes” for net wealth above €3 million, designed to harmonize outcomes and backstop revenues where regions zero-rated the regional tax. Rates are progressive (roughly 1.7%–3.5% over the threshold) and the tax sits on top of the regular wealth tax. BOEAgencia TributariaPwC Tax SummariesTax Foundation

What did it raise? In its first year, Spain said the solidarity levy collected €632 million from about 12,010 taxpayers(≈0.1% of filers). In total, taxes on large fortunes (solidarity + regional wealth tax) brought in more than €1.8 billion in 2023. Policymakers then made the solidarity tax permanent to prevent revenue leakage from regional rebates. Reutersinfobae

Takeaway: Spain shows a workable model when sub-national rebates undermine a national base: introduce a uniform top-up with clear thresholds and keep administration simple by mirroring existing wealth-tax rules. BOE

Sweden: a century of wealth tax, then repeal

Sweden introduced a national wealth tax in 1911 and kept some form of it for nearly a century. Over time, concerns grew about valuation complexity, tax avoidance, and capital flight (especially for owners of closely held firms). In 2007, the center-right government abolished the wealth tax. Academic post-mortems point to low revenue relative to administrative and economic costs and the difficulty of valuing private assets consistently. PikettyIFNEconometrics Laboratory

Takeaway: Sweden’s experience underscores that design details matter: if valuation is onerous and the base is porous, the tax can raise little while nudging high-wealth households toward avoidance or emigration. IFN

Norway: the durable model

Norway still levies a net wealth tax—one of Europe’s oldest (tracing to 1892). The combined municipal + national rate is about 1.1% on wealth above NOK 20 million (≈$1.8–1.9 million), with valuation discounts for certain assets (e.g., closely held shares) and coordinated state/municipal sharing. OECD and independent trackers note that Norway reliably collects meaningful, if modest, revenue from its wealth tax (on the order of ~1% of total tax revenue in recent years). After rate tweaks in 2022–23, Norwegian media reported a spike in wealthy out-migration, highlighting the importance of calibration—but the tax remains in force. Tax Foundation+1Skatteetaten

Takeaway: Norway suggests a pragmatic, durable design: moderate rates, clear valuation rules, and discounts to ease liquidity/valuation frictions for private businesses—all while keeping the base broad enough to matter. Skatteetaten

Lessons across the three

1. Base clarity beats ambition. Spain’s top-up mirrors the existing wealth-tax base; Norway codifies discounts and annual valuation methods; Sweden’s complexity/avoidance sank the policy. BOESkatteetatenIFN

2. Moderate rates + tight administration work better than high rates on a leaky base. Norway’s ~1.1% top rate is politically and administratively durable. Tax Foundation

3. Sub-national coordination matters. Spain’s solidarity levy overcame regional rebates; a U.S. analog would need federal-state coordination. infobae

The U.S. angle: closing aid gaps and shoring up human needs

Right now, U.S. humanitarian funding is under pressure. In August 2025, President Trump blocked $4.9 billion in already-approved foreign aid via a rarely used rescission maneuver, and broader proposals to pare back foreign assistance have circulated—raising near-term risks for global health, food security, and refugee support. Federal News NetworkThe White HouseThe Washington PostThe Wall Street Journal

A U.S. wealth-tax option—built to Norway/Spain specifications—could help:

• Who pays? Top 1% by net wealth (or a narrower “UHNW” tier).

• Rate & base (illustrative): 1% on net wealth above $50 million, with public assets marked to market each year and private assets taxed at realization with an interest charge (a “deferral charge”)—the same liquidity/valuation playbook seen in Norway’s discounts and Spain’s mirroring approach. SkatteetatenBOE

• Administration: Expanded third-party reporting for brokers and custodians; safe-harbor valuation for closely held firms; elective installment plans for illiquid cases—again, echoing Norway’s practicality. Skatteetaten

How much could it raise? The U.S. now has a record ~902 billionaires (Forbes, March 2025). Even a narrow billionaire-only levy at ~1% of net wealth could generate tens of billions per year; broadening the base to the top 1%would raise more. (For context, Spain’s wealth/solidarity taxes together raised ~€1.8 billion in 2023 from a far smaller high-wealth population.) ForbesReuters

Where it would go

Create a federal Humanitarian & Community Resilience Fund to channel receipts into:

• International humanitarian aid: stabilize a recurring $9 billion floor for food aid, health, and refugee response—insulated from rescissions. Federal News Network

• Domestic “humanitarian” programs: targeted grants for K-12 in low-income districts, nutrition (WIC/SNAP complements), and community health clinics, with transparent, formula-based allocations and independent audits.

Why this version is more likely to work

• Design learns from Europe: adopt moderate rates, clear valuation, and liquidity relief, avoiding Sweden’s pitfalls. IFN

• Stability by statute: dedicate funds to a trust-style account so short-term politics can’t raid them—an answer to the 2025 aid freeze episode. Federal News Network

Bottom line

Spain shows how to harmonize and backstop wealth-tax revenue; Norway shows how to keep it durable; Sweden shows what happens when complexity and leakage overwhelm the base. A U.S. version that borrows the Norway/Spainplaybook—moderate rate, clear valuation, liquidity protections, and earmarked uses—could reliably backfill humanitarian aid cutbacks and supplement domestic education, food, and health programs without leaning on annual budget brinkmanship. Tax FoundationBOEFederal News Network