Wealth taxes destroy more revenue from mobile tax bases than they directly collect.
The out-migration of high-net-worth individuals seeking to avoid wealth levies systematically degrades stable income and consumption tax streams, yielding a net fiscal loss for the taxing government.
The same conclusion keeps arriving from across the workspace's research — 1 topics independently instantiate this theme. Filter the evidence by where it came from:
The Hoover Institution's model of California's proposed wealth tax warns of a net-negative fiscal impact due to the permanent loss of departing taxpayers' future income tax contributions.
It shows that Spain's double-decker wealth tax caused heavy capital flight to jurisdictions like neighboring Portugal, leaving the central government with a massive collection deficit.
The Scandinavian empirical data proves that wealth taxes suffer from exceptionally high revenue leakage, as tax-avoidant behavioral changes and flight cannibalize other tax streams.