Subnational tax competition neutralizes wealth taxes unless central governments impose mandatory rate floors.
To prevent capital flight and tax arbitrage to tax-friendly regions, central governments must implement national safety-net taxes that override regional fiscal autonomy.
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 Swiss experience demonstrates that subnational wealth taxes are highly vulnerable to tax competition and relocation to nearby low-tax jurisdictions.
Spain's central government was forced to mandate a national solidarity tax floor to neutralize local tax rebates that were causing regional capital flight.
This shows how unchecked tax competition across European states historically led to the collapse and abandonment of regional wealth regimes.