【Wen/Observer Net Zhang Jingjuan】As the birthplace of the modern stock market, the Netherlands now has taken an extremely radical path in global capital tax reform.

The Washington Post of the United States on the 21st titled "The Architect of Capitalism Tries to Destroy It" published an article stating that the Dutch parliament has passed a bill proposing to impose a 36% capital gains tax on savings and most liquid investments.

The article said that unlike the usual practice of countries such as the United States, which only taxes when assets are sold and profits are realized, the new bill set to take effect in 2028 requires annual taxation of unrealized gains.

This means that regardless of whether the assets are sold, individuals' savings accounts, cryptocurrencies, most stock investments, and income from interest-bearing financial instruments will be subject to this tax. This rate is 16 percentage points higher than the average of the Organization for Economic Co-operation and Development (OECD).

It is worth noting that real estate and shares of qualifying startups will be subject to different rules. According to Cryptopolitan, for these assets, the government will adopt a capital gains tax model, meaning that the appreciated portion is only taxed when the asset is sold or disposed of. According to insiders, regular income generated by such assets, such as rent and dividends, still needs to be taxed annually upon actual receipt.

The Washington Post stated that usually, supporters of such taxes argue that they regulate wealth gaps, but the Netherlands is one of the countries with the smallest wealth gaps among developed nations. More importantly, this tax is not only targeted at the rich but covers all citizens who hold stocks and bonds "in a one-size-fits-all" manner.

Supporters of the tax cry, "Billionaires should pay more taxes." However, there are only 13 billionaires in the Netherlands, a number comparable to that of Colorado or Arizona in the United States, and they can easily transfer their wealth overseas.

Amssterdam Stock Exchange, Reuters

Similar situations have already occurred in Europe. Norway has already imposed a wealth tax on unrealized gains, and if taxpayers choose to leave Norway, the part of their unrealized capital gains (such as paper gains from stock appreciation but not yet sold) exceeding 3 million kroner must be taxed at 37.8%.

The result found that even with high taxes, capital outflows could not be stopped. Data shows that over 100 of the top 400 wealthiest people in Norway have moved abroad or transferred assets to foreign relatives.

The article further analyzed that the Netherlands is a member of the EU, and its citizens can more conveniently move and transfer assets within Europe compared to non-EU countries like Norway.

Looking across Europe, wealth taxes are not a new concept, but their effectiveness has been disappointing. The 1990s were the peak period for European wealth taxes, and many countries later abolished related taxes due to unmet tax expectations and discouraging business investment.

The Washington Post pointed out that those affected by tax reforms are not only the rich. The tax burden on ordinary salaried workers in the Netherlands has reached as high as 35%, while this proportion in the United States is only 30%. Healthcare in the Netherlands is not free; in the government-mandated health insurance, 45% of the costs are borne by individual premiums, and 84% of the population also purchases additional commercial insurance. In addition, the standard VAT rate in the Netherlands is 21%, nearly three times the average sales tax in the United States. Despite this, the Netherlands is still considered a low-tax country by European standards.

According to reports, many people have expressed opposition to this. Denis Payre, CEO of Belgian internet logistics company Kiala, said that France did this in 1997, resulting in a large number of entrepreneurs leaving. Renowned cryptocurrency analyst Michael van der Poppe called the bill "the stupidest approach I've seen in a long time," and warned that the number of people preparing to leave the Netherlands would be absurdly high.

This view has been generally recognized by industry analysts and corporate executives.

Investment research firm Investing Visuals calculated that an investor initially invested 10,000 euros (about 11,871 US dollars), then added 1,000 euros monthly, maintaining it for 40 years, and the final asset size could reach about 3.32 million euros. However, under the new tax system of 36%, the total assets after 40 years would drop to about 1.885 million euros, a difference of 1.435 million euros.

The Washington Post concluded the article by lamenting that the modern stock market originated here, and if this place of origin were to brutally attack the core wealth creation model it had pioneered, it would be a great tragedy.

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Original: toutiao.com/article/7609661123838640678/

Statement: The article represents the views of the author himself.