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“They are asset-rich and cash-poor. A wealth tax would force them to sell.”

A pensioner with a paid-off house still pays property tax, and a fortune can pay a wealth tax the same way

Norway lets owners defer wealth tax on business wealth for up to three years from income year 2026, and its exit tax can be paid over 12 years. A 1% annual tax on a fortune equals a 20% tax on a 5% return. Where cash really matters, in dividends, the best Norwegian evidence finds firms whose owners pay the tax paid out no more, invested no less and went bust no more often.

By Egalitaristen · Updated November 9, 2026 · 4 min read

Everyone who owns a house knows this problem. The property tax bill arrives once a year, and a retired owner with a small income and a paid-off house owes it in full. She pays from savings, borrows against the house, sells it or asks for a deferral. Nobody proposes abolishing property tax because some owners are house-rich and cash-poor. We accept that for every other tax, and the objection asks us to drop it for the largest fortunes alone.

#The size of the bill

The objection says a wealth tax forces owners of companies and land to sell. Look at the size of the bill. A 1% tax on the value of a fortune is the same as a 20% tax on a 5% return.^[3] An owner whose wealth earns 5% a year and pays a 1% wealth tax hands over one fifth of the return and keeps four fifths.

The money is there. In Norway and Sweden, personal holding companies shield about half of dividend distributions from individual income tax, so owners keep large sums inside companies they control.^[7] In the United States the private companies of the 400 richest people pay out less than 10% of their profits as dividends.^[9] The owner decides how much of it to pay out.

#Four ways to pay

An owner who has the wealth and not the cash has four ways to pay.

Sell a slice. Selling a small part of a fortune to pay 1% or 2% leaves 98% or 99% of it.
Borrow against the assets, the way a homeowner does to pay a property tax.
Take a dividend or a distribution from the company.
Defer. Norway lets private individuals defer the wealth tax attributed to business wealth for up to three years, if it's NOK 30,000 or more, at the central bank's rate plus 5 percentage points. The first income year is 2026.^[1]

Norway's exit tax works the same way. Since March 2024 the tax on the unrealised gains of people who leave can be paid over 12 years, in instalments or deferred with interest.^[5] Proposals for new taxes carry such schemes too: California's Proposition 40 would have let payers spread the tax over five equal annual instalments, with a 7.5% yearly charge on the unpaid balance.^[2] The schemes exist. The only question is how long to wait and what interest to charge.

#What Norwegian firms did

Norway raised its wealth tax in 2021 to 2024, so we can see what happened to companies whose owners pay it. An economist who studied them finds no sign that they paid out more dividends, invested less or went bankrupt more often.^[4]

Opponents point to two things. Norway raised its dividend tax from 32% to almost 38% by 2023, which makes it dearer to pay the wealth tax out of dividends.^[4] That is an argument for tax design: let the owner defer, or let the company pay the tax on its owner's behalf. And a think tank that campaigns against taxes on ownership found that people with more than NOK 10 million who moved abroad held 58% to 93% of their wealth in shares of limited companies.^[6] Wealth held in companies is the wealth that grows without anyone ever paying tax on it. The think tank also says its analysis doesn't show the tax caused the moves.^[6]

#The wealth that never paid

Why is there so little cash? Because top wealth mostly grows as company value. In the countries where it has been measured, it's mostly shares in private companies.^[7] That wealth grows as retained profit and unrealised gain, with no taxable event along the way, so the owner has paid no tax on the growth and has no sale proceeds to pay one. In the United States, to give one estimate, capital gains are 50% of wealth for households with more than US$50 million, and about 90% of those gains are in business shares.^[8] An annual tax on the stock gives that wealth its first tax bill.

#A design for owners

Keep the owner's choices open. Allow instalments or deferral at an interest rate above the central bank's rate, so deferral is no free loan. Let a company pay the tax on its owner's behalf. Set the threshold high so only a few households are asked. Charge the owner of a private company on the company's value and let her choose between selling a slice, paying a dividend and borrowing.

#Who says so

The Norwegian story covers the deferral scheme, the Swedish story the holding companies, and the United States story covers Proposition 40.

#Where to look next

The next page takes up the claim that a wealth tax is double taxation. The Norwegian and United States stories carry the underlying sources.