Discussion paper

DP14054 Behavioral Responses to Wealth Taxes: Evidence from Switzerland

We study how reported wealth responds to changes in wealth tax rates. Exploiting rich intra-national variation in Switzerland, the country with the highest revenue share of annual wealth taxation in the OECD, we find that a 1 percentage point drop in the wealth tax rate raises reported wealth by at least 43% after 6 years. Administrative tax records of two cantons with quasi-randomly assigned differential tax reforms suggest that 24% of the effect arise from taxpayer mobility and 20% from house price capitalization. Savings responses appear unable to explain more than a small fraction of the remainder, suggesting sizable evasion responses in this setting with no third-party reporting of financial wealth.


Brülhart, M, J Gruber, M Krapf and K Schmidheiny (2019), ‘DP14054 Behavioral Responses to Wealth Taxes: Evidence from Switzerland‘, CEPR Discussion Paper No. 14054. CEPR Press, Paris & London. https://cepr.org/publications/dp14054