4 ms·

Norway also has crazy exit tax and wealth tax. I heard lots of complaints that this system makes it almost impossible to build a decent vc-driven tech startup.

enricozb 1y ago
However it also prevents hoarding wealth, which in turn prevents special interest groups and some forms of election manipulation. Balancing taxes for fairness and innovation is quite tricky...
- logicchains 1y ago
  >However it also prevents hoarding wealth Hoarding wealth isn't a problem if no wealth creation happens in the first place.
- procaryote 1y ago
  An exit tax in itself does nothing to prevent hoarding of wealth. It might enable you to deploy other taxes that would make rational people leave the country, but it's a bit of a "lock the doors and rob people" strategy. If you have good advisors as a wealthy person you know this and leave as soon as an exit tax is on the table. If you start new businesses you start them outside of the country If you're a regular non-wealthy person who happens to become successful you're stuck paying high taxes of course, but you'll probably learn and structure your next venture better.
  - swexbe 1y ago
    Most businesses are not as portable as a tech startup.
    - procaryote 1y ago
      Ownership is though.
- shankr 1y ago
  Most of Scandinavia is rife with old money. It's just that new entrants aren't allowed to build wealth. https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed https://www.euronews.com/business/2024/04/01/wealth-inequali...
  - enricozb 1y ago
    This article seems to argue that the cause of the inequality is the lack of taxes
jeofken 1y ago
Norway has a high wealth tax (it’s gonna be 1.1% of total wealth per year in normal cases), high capital gains tax, and an exit tax treating moving abroad as a capital gains event. This means, if you start a not-yet-publicly-listed company, get investment at a high valuation (on paper), you must pay wealth tax as if you had that money liquid in your own name. But you don’t have it liquid, it’s yet just a valuation of a VC, so you are screwed. This means any Norwegian trying to start eg a fast growing software biz must relocate to Sweden if they want to be close to home, or Switzerland more realistically, as swedens top income tax bracket is >50%. Scandinavia is attractive as a destination if you are poor and especially from the 3rd world and could benefit from free government services and welfare, but for anyone entrepreneurial or already wealthy, there are many better alternatives.
- saubeidl 1y ago
  It's also an attractive destination for people wanting to live in a society that's not completely broken by inequality and are willing to pay their membership dues for living in such a society. Not everyone's top priority is building a big ol' dragon pile of gold.
  - vixen99 1y ago
    Well while celebrating, let's remember that the dream leans massively on the US. 74% of Europe's publicly listed companies depend on US-based technology services like Google and Microsoft for their core operations. And can Europe defend itself? No is the response most analysts give. It's massively under-resourced & dependent on the US. However, if Russia invades (as predicted by some), it invades Europe. So in negotiations such as they are, where are the Europeans leaders dominating (or even putting an appearance at) the discussion to try to call a cease fire to the appalling tragedy of Russia's invasion of the country adjacent to European territory? Isn't it kind of embarrassing? Overstaying a visa is an offence and if you've gone through the efforts of getting one in the first place, you should read the regulations. Most of us do and act accordingly as I know from own situation this summer.
  - FredPret 1y ago
    In what way does inequality break society? I’ve frequently heard this article of faith bandied about. But if the rich get 10X richer, and the poor get 2X richer, then everybody is better off. The stagnant, ultraconservative, ultracentralized economic systems tankies like to propose always end up leaving everyone 100X poorer. But at least they’re equal, right!? Seems like cutting off your nose to spite your face.
kharann 1y ago
Kinda makes it harder to attract foreign talent to Norwegian startups as it could affect their decision moving to Norway. While I think the number of people affected is exaggerated, the most well-known case would be the Dune Analytics founder who had to pay more in tax than his salary and was forced to either take a loan to pay taxes (no guarantee the company would succeed) or move out of the country.
- throw9349494 1y ago
  This, and barnevernet has reputation similar to gestapo in East Europe.
  - eqvinox 1y ago
    You might've mixed up your analogy there, Gestapo was a German 3rd Reich thing… NKVD would be the Soviet one.
    - tmtvl 1y ago
      Or the Stasi (Staatssicherheit) for the DDR.
    - throw9349494 1y ago
      Germans (including gestapo) gassed a few million people here. Soviets (including NKVD) liberated survivors. But maybe I read wrong history books.
      - eqvinox 1y ago
        That wasn't what I meant, I'm confused why you're associating the Gestapo with Eastern Europe. They were active in all of German controlled Europe with a pretty bad reputation almost everywhere. The nazi mass murders also have more of an association with the SS rather than the Gestapo, especially when it got worse in the later years. (FYI, the NKVD killed more than 100'000 Poles in a just a few months in 1941. I haven't found a total. But they were also active in all of the CCCP. Not sure what would be an Eastern Europe specific reference here…)

enricozb 1y ago

However it also prevents hoarding wealth, which in turn prevents special interest groups and some forms of election manipulation. Balancing taxes for fairness and innovation is quite tricky...

logicchains 1y ago
>However it also prevents hoarding wealth Hoarding wealth isn't a problem if no wealth creation happens in the first place.
procaryote 1y ago
An exit tax in itself does nothing to prevent hoarding of wealth. It might enable you to deploy other taxes that would make rational people leave the country, but it's a bit of a "lock the doors and rob people" strategy. If you have good advisors as a wealthy person you know this and leave as soon as an exit tax is on the table. If you start new businesses you start them outside of the country If you're a regular non-wealthy person who happens to become successful you're stuck paying high taxes of course, but you'll probably learn and structure your next venture better.
- swexbe 1y ago
  Most businesses are not as portable as a tech startup.
  - procaryote 1y ago
    Ownership is though.
shankr 1y ago
Most of Scandinavia is rife with old money. It's just that new entrants aren't allowed to build wealth. https://www.euronews.com/business/2024/04/01/wealth-inequality-where-in-europe-is-wealth-most-unfairly-distributed https://www.euronews.com/business/2024/04/01/wealth-inequali...
- enricozb 1y ago
  This article seems to argue that the cause of the inequality is the lack of taxes

jeofken 1y ago

Norway has a high wealth tax (it’s gonna be 1.1% of total wealth per year in normal cases), high capital gains tax, and an exit tax treating moving abroad as a capital gains event. This means, if you start a not-yet-publicly-listed company, get investment at a high valuation (on paper), you must pay wealth tax as if you had that money liquid in your own name. But you don’t have it liquid, it’s yet just a valuation of a VC, so you are screwed. This means any Norwegian trying to start eg a fast growing software biz must relocate to Sweden if they want to be close to home, or Switzerland more realistically, as swedens top income tax bracket is >50%. Scandinavia is attractive as a destination if you are poor and especially from the 3rd world and could benefit from free government services and welfare, but for anyone entrepreneurial or already wealthy, there are many better alternatives.

saubeidl 1y ago
It's also an attractive destination for people wanting to live in a society that's not completely broken by inequality and are willing to pay their membership dues for living in such a society. Not everyone's top priority is building a big ol' dragon pile of gold.
- vixen99 1y ago
  Well while celebrating, let's remember that the dream leans massively on the US. 74% of Europe's publicly listed companies depend on US-based technology services like Google and Microsoft for their core operations. And can Europe defend itself? No is the response most analysts give. It's massively under-resourced & dependent on the US. However, if Russia invades (as predicted by some), it invades Europe. So in negotiations such as they are, where are the Europeans leaders dominating (or even putting an appearance at) the discussion to try to call a cease fire to the appalling tragedy of Russia's invasion of the country adjacent to European territory? Isn't it kind of embarrassing? Overstaying a visa is an offence and if you've gone through the efforts of getting one in the first place, you should read the regulations. Most of us do and act accordingly as I know from own situation this summer.
- FredPret 1y ago
  In what way does inequality break society? I’ve frequently heard this article of faith bandied about. But if the rich get 10X richer, and the poor get 2X richer, then everybody is better off. The stagnant, ultraconservative, ultracentralized economic systems tankies like to propose always end up leaving everyone 100X poorer. But at least they’re equal, right!? Seems like cutting off your nose to spite your face.

kharann 1y ago

Kinda makes it harder to attract foreign talent to Norwegian startups as it could affect their decision moving to Norway. While I think the number of people affected is exaggerated, the most well-known case would be the Dune Analytics founder who had to pay more in tax than his salary and was forced to either take a loan to pay taxes (no guarantee the company would succeed) or move out of the country.

throw9349494 1y ago
This, and barnevernet has reputation similar to gestapo in East Europe.
- eqvinox 1y ago
  You might've mixed up your analogy there, Gestapo was a German 3rd Reich thing… NKVD would be the Soviet one.
  - tmtvl 1y ago
    Or the Stasi (Staatssicherheit) for the DDR.
  - throw9349494 1y ago
    Germans (including gestapo) gassed a few million people here. Soviets (including NKVD) liberated survivors. But maybe I read wrong history books.
    - eqvinox 1y ago
      That wasn't what I meant, I'm confused why you're associating the Gestapo with Eastern Europe. They were active in all of German controlled Europe with a pretty bad reputation almost everywhere. The nazi mass murders also have more of an association with the SS rather than the Gestapo, especially when it got worse in the later years. (FYI, the NKVD killed more than 100'000 Poles in a just a few months in 1941. I haven't found a total. But they were also active in all of the CCCP. Not sure what would be an Eastern Europe specific reference here…)