BJÖRN BORG, COME HOME
April 13, 2007
Those on the left who have long sought economic guidance from egalitarian Sweden need a new role model. Stockholm is spouting heresy these days by talking up the benefits of lower taxes, says the Wall Street Journal.
The latest tax to bite the dust is the 1 percent property tax for houses and 0.5 percent for apartments. The center-right coalition government announced last week that it is replacing it with a small, flat fee. That move comes amid the looming demise of the wealth tax, which the government also says it will abolish this year.
- This tax on the "rich" dates back to 1947 and is imposed on assets -- the family Volvo, house, bank accounts -- above 1.5 million kronor ($215,000) for singles and three million kronor for couples.
- The current rate is 0.75 percent, down from 1.5 percent last year; that's on top of income taxes, which range between 29 percent and a top marginal rate of about 60 percent.
Wealth taxes used to be de rigueur in Europe, where there are only a few holdouts:
- France's is between 0.5 percent and 1.8 percent on assets above $1 million.
- In Spain, it's 0.2 percent to 2.5 percent on assets above $223,000.
But rather than transferring wealth, wealth taxes transfer the wealthy. In Sweden, tennis star Björn Borg, ABBA's Björn Ulvaeus and Ikea founder Ingvar Kamprad are among the mega-rich who have fled the country, taking their money with them.
Getting rid of the wealth tax is "a step on the way back toward making Sweden an entrepreneurial country," says Finance Minister Anders Borg. That's sound capitalist advice from the cradle of welfare socialism, says the Journal.
Source: Editorial, "Björn Borg, Come Home," Wall Street Journal, April 11, 2007.
Browse more articles on International Issues