A wealth tax is a recurring annual levy on the total value of a person’s assets minus debts — the net worth itself — rather than on income earned or an asset transferred at a sale or death.
In plain terms
Most taxes wait for something to happen: a paycheck arrives, a stock is sold, an estate changes hands. A wealth tax does not wait. It is assessed on the stock of net worth every year, whether or not that wealth produced any cash that year, which is precisely why it is controversial for anyone holding illiquid assets — a stake in a private company, a block of restricted stock, a building — where the tax bill can exceed the cash the asset actually generated in that period. No version of this exists at the US federal level, though it is a live proposal and an operating system in a handful of other countries.
How it works
A wealth tax requires valuing every asset a person owns as of a single date each year, subtracting debts, and applying a rate above an exemption. Norway runs the clearest working example: its tax authority, Skatteetaten, assesses both a municipal and a state wealth tax on individual net worth above a basic threshold, with a higher state rate kicking in at a much larger threshold.
In the United States, the closest live proposal is the Ultra-Millionaire Tax Act, reintroduced in 2026 by Senator Elizabeth Warren. Its bill text defines the base as the net value of “all property of the taxpayer… real or personal, tangible or intangible, wherever situated, reduced by any debts” — not merely financial holdings — and layers a rate schedule above a $50 million floor.
The numbers
- Norway, 2026: municipal wealth tax of 0.35% plus a state wealth tax of 0.65%, rising to 0.75% on net wealth above NOK 21,500,000, all above a basic threshold of NOK 1,900,000 (doubled for jointly assessed couples).
- Ultra-Millionaire Tax Act of 2026 (proposed, not enacted): 0% up to $50 million in net worth, 2% from $50 million to $1 billion, 3% above $1 billion (rising to 6% on the top tier only in a year certain universal health-coverage legislation is also in effect).
- Households affected under the US proposal: an estimated 260,000, or roughly the top 0.15%, per the bill’s sponsors.
- Projected 10-year revenue, sponsors’ estimate: $6.2 trillion.
- Expatriation penalty in the same bill: a 40% exit tax on the net worth of anyone renouncing US citizenship above the $50 million threshold.
What people get wrong
That the US already has something close to a wealth tax through the estate tax or state “millionaire” income surtaxes. Neither qualifies: the estate tax taxes a transfer at death, and a state surtax taxes realized income — both wait for an event. A true wealth tax taxes the asset’s existence, which is exactly the feature that makes it hard to administer: a private business or an art collection has no daily price tag, so an accurate annual valuation becomes its own bureaucracy. That valuation problem, more than any political reversal, is the main reason several European countries that once ran a general wealth tax — among them France, Germany, and Sweden — no longer do.
Related
Read more: Taxing the Billionaires: Wealth-Tax Debates From California to Warren · Billionaire Rankings 2026: Musk, Bezos, Page Lead the List — and How It Is Counted
See also: Estate tax exemption · Net investment income tax · Liquid net worth