One of the world’s richest countries has taxed wealth for over a century—and added millionaires

Switzerland has long been famous as a haven for wealth, with Swiss bank accounts drawing money from rich people across the globe.

On a per-capita GDP basis, the country is the fourth wealthiest in the world at $126,177, trailing only Liechtenstein, Luxembourg and Ireland, which has seen its economic data inflated by multinational companies domiciling there for tax purposes.

That’s despite Switzerland’s cantons levying wealth taxes for more than a century. The key to its success as a wealth haven that still taxes wealth is its low rate, according to Warren Gorlick, a retired policy adviser at the Treasury Department.

In a Washington Post op-ed last week, he pointed out that Swiss wealth taxes haven’t chased off the rich. In fact, the number of adults with $5 million-$10 million in assets actually grew 7.4% annually from 2000 to 2025.

While each canton sets its own rate, even those at the high end are modest relative to what’s being considered in the U.S., where wealth taxes have gained political traction recently.

In Zurich, for example, a married couple with $2.5 million in net worth pays an effective rate of just 0.24%, translating to about $6,000 a year, according to Gorlick. And for someone with $1 billion in net worth, the effective rate is 0.7%, or $7 million a year.

By contrast, California’s Proposition 40 ballot initiative calls for residents worth more than $1 billion to pay a one-time tax equivalent to 5% of their assets.

Polls show a close call, but Prop 40 has already caused some of California’s wealthy to flee the state. That includes Google cofounder Sergey Brin, who has relocated to Nevada and contributed over $100 million toward opposing the billionaire tax. Uber cofounder Travis Kalanick also confirmed he left California and moved to Texas.

Prop 40 supporters point to the AI boom and say California’s ultra-rich would still be among the world’s wealthiest. Opponents warn the tax is unlikely to be a one-time levy and that some startup founders could be forced to sell their controlling stakes to pay the tax due to how Prop 40 values assets.

Even if Prop 40 fails, the idea of a wealth tax will live on. California Gov. Gavin Newsom, who many expect will in the not-so-distant future become a presidential candidate, is against Prop 40 but supports a nationwide wealth tax.

Sen. Elizabeth Warren has proposed a 2% tax on wealth above $50 million and 3% above $1 billion. Sen. Bernie Sanders and Rep. Ro Khanna have introduced legislation for a 5% tax on billionaires. Even United Airlines CEO Scott Kirby has said the U.S. should have a national wealth tax.

Meanwhile, a group of Nobel laureate economists who are in favor of Prop 40 have said it could “kickstart a movement” that spreads to other states and countries.

Gorlick, the former Treasury adviser, noted that not all wealth produces regular income, meaning a 5% tax on $1 billion in assets results in a $50 million annual bill that may require selling some holdings in order to pay it off.

“Few people will muster much sympathy for a billionaire’s tax problem, but a wealth tax that assumes capital can be taxed indefinitely at a high rate is a wealth tax that ultimately won’t be paid, because the wealth — or its owner — will simply be gone,” he wrote.

Rather than rates proposed by Warren, Gorlick argued the U.S. should consider a Swiss-style wealth tax. A hypothetical top levy of 0.5% on $1 billion in assets would require paying the IRS $5 million a year, an amount that he doubts would cause billionaires to move abroad.

If a 0.5% rate is applied to the richest 1% of U.S. households, it could easily generate $200 billion a year, he estimated.

Of course, that’s just a drop in the bucket compared to U.S. debt of $40 trillion, or even the $7.4 trillion the federal government spent in fiscal 2026.

But a wealth tax could still raise significant revenue without hiking income taxes, Gorlick said. That’s as the federal government plans to boost defense spending while also facing the insolvency of the Social Security retirement trust fund in six years.

“A modest wealth tax won’t, by itself, solve America’s $2 trillion annual deficit,” he admitted. “But it would be a meaningful down payment toward addressing America’s fiscal imbalance — one that both sides could get behind.”

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