In the US, we’re still stuck on the question of whether we should tax wealth at all. In Sweden, that ship has already sailed—and now it’s a superyacht. They had a wealth tax, scrapped it in 2006, and are living through the results of that decision.
The US could learn from a country that once built its identity around collective security, then quietly pivoted toward individual accumulation.
Sweden dropped its wealth tax soon after enacting another regressive policy reform: It had repealed inheritance taxes the year prior. Two decades later, the results speak for themselves. Sweden now boasts one of the highest per-capita billionaire rates in the world, but its Gini coefficient —a measure of inequality—has crept up at a similar pace.
Private household services such as cleaners and nannies have become the norm. Shared investment, previously captured in the idea of folkhemmet, or “the people’s home,” has given way to tax optimization strategies and significant lifestyle stratification.
The lack of resistance to the policy shift at the time is striking. Swedish pensioners interviewed last month don’t recall fighting it. Many, it seems, barely noticed. Now they’re reckoning with what slipped away and reflecting on the loss of a sense of cohesion, reciprocity, and a shared future.
Sweden offers a rare controlled experiment for the US. The lesson isn’t buried in GDP trendlines—it’s playing out in neighborhoods, the social safety net, and generational trust.
Here, our wealth tax debates tend to focus on optimal rates, how to value illiquid assets, and enforcement details. They’re important implementation questions, but maybe not the most important facets.
Sweden’s post-wealth tax experience shows us that taxation doesn’t just affect balance sheets. It shapes and informs expectations, civic responsibility, and the architecture of belonging.
—Andrew Leahey
Welcome to the Week in Insights for Bloomberg Tax’s latest analysis and news commentary. This week, former IRS commissioner Danny Werfel debuted his monthly column, By All Accounts. Also, experts analyzed New York Gov. Kathy Hochul’s (D) tax plan for charities, the Trump administration’s “tariff toolkit,” and more.
The Exchange—It’s where great ideas on tax and accounting intersect.
By All Accounts
Government probes of fraud—such as the high profile cases in Minnesota and Mississippi—help provide accountability over how taxpayer dollars are spent but too often lack a clear accounting for the tradeoffs needed to stop fraud, Danny Werfel says in his debut column, By All Accounts.
“Preventing erroneous payments almost always means asking more of everyone, including legitimate recipients—more reporting, more documentation, and more delays to allow for intensified government review,” Danny writes. “When we choose to limit those burdens and get payments out the door quickly, we choose to accept a higher risk of fraud and error.” Read More
Insights
UK, EU Must Grapple With Implications of OECD Side-by-Side Deal
The OECD’s new “side-by-side” deal exempts US-headquartered multinationals from much of its global minimum tax rules. This creates several policy and practical challenges for the UK and other European jurisdictions.
New Nigeria Tax Law Redefines Capital Gains Tax for Individuals
Nigeria’s Tax Act, which took effect Jan. 1, fundamentally shifts how individuals can dispose of property, investments, and other chargeable assets.
Hochul Tax Plan for Charities Could Reshape Business Philanthropy
New York Gov. Kathy Hochul’s proposal to safeguard the deductibility of charitable donations against state taxation carries broad implications for businesses, including redefining how corporate philanthropy is planned.
Making Chile ‘Great Again’ Means Facing Political Reality on Tax
Chile’s president-elect José Antonio Kass faces a choice to substantially change the tax system with the aim of boosting the Chilean economy, or to work within the existing system so that the investment environment is perceived as stable and business-friendly.
Trump’s Well-Stocked Tariff Toolkit Demands Importers’ Attention
Regardless how the Supreme Court rules on the Trump administration’s broad use of tariffs, the US trade agenda will likely continue relying on other tariff authorities, so affected businesses should take practical steps to avoid risk.
AI Makes Tracking Foreign Digital Taxes Harder. Here’s What to Do
Implementing digital taxes can be messy, and authorities may not know whether to base taxpayer location for nexus on user location, billing address, IP address, or market participation, but it’s important to track them all.
UAE Offers Multinationals a Route to Tax Certainty With APAs
The United Arab Emirates has taken a decisive step toward strengthening tax certainty under its corporate tax regime with the release of long-awaited guidance on advance pricing agreements.
Hawaii’s Income Tax Cut U-Turn Muddles Relief for Working Class
A proposal to eliminate Hawaii income tax cuts enacted in 2024 could undermine past efforts to provide tax relief for lower-income households.
Technically Speaking
Volkswagen’s canceled plans to build an Audi plant in the US highlight how tariff policies can backfire when businesses don’t prioritize the US market as much as policymakers expect, Andrew Leahey says in his latest Technically Speaking column.
“At best, tariffs are a century-old tool misapplied to a modern economy,” Andrew writes, adding that lawmakers should require market-based return on investment modeling before imposing new tariff systems. Read More
News Roundup
Former Tax Officials Raise Ethics Alarm on Trump’s IRS Lawsuit
Former government tax officials are asking a judge to take proactive moves to curb the ethical issues arising out of President Donald Trump’s lawsuit against the IRS.
New US Audit Board Leaders Have a Track Record Gutting Agencies
A pair of Trump administration officials who will soon serve on the US audit board advanced the president’s regulatory rollback agenda that has slashed spending and hollowed out federal agencies.
IRS Gets Money-Moving Authority at Same Time It’s Losing Funds
Congressional appropriators gave the IRS a lifeline to shift money around to stave off funding cliffs, but some are saying it might not be enough.
India Budget Delivers on Tax Measures to Boost IT Sector
India’s proposals to ease tax rules for multinationals in its 2026 budget unveiled Sunday will provide them the certainty they need in cross-border transactions, according to practitioners.
Tax Management Memorandum
HR Solutions That Become Tax Problems: How to Minimize Risk
HR solutions can create unexpected tax liabilities, requiring cross-functional vigilance and proactive strategies to ensure compliance.
DOJ Tax’s Dissolution Forces a High-Stakes Reset for IRS and DOJ
The DOJ Tax Division’s dissolution necessitates a post-mortem of the IRS-DOJ partnership to identify the critical elements for U.S. tax enforcement and voluntary compliance.
Why Partnerships Are Surprised by High Imputed Underpayments
Imputed underpayments under the Bipartisan Budget Act of 2015 are often unexpectedly high due to the inclusion of non-income items in calculations, affecting partnerships during audits and Administrative Adjustment Requests.
Can Soaring Tech Salaries Still Qualify for R&D Tax Credits?
Elite engineers’ soaring compensation packages are complicating R&D tax credit claims under IRC §41, requiring companies to enhance their audit readiness with more rigorous documentation of qualified research activities.
Career Moves
Akin Taps Richard Wright as Tax Partner in New York Office
Richard Wright joined Akin as a tax partner in its New York office, the firm announced Monday.
Kirkland Adds Jonathan Macke as Partner in Tax Practice Group
Jonathan Macke joined Kirkland & Ellis as a partner in its tax practice group, the firm announced.
Davis Polk Taps Brian Grieve as Partner in New York Tax Practice
Brian Grieve joined Davis Polk as a partner in its tax practice in New York City, the firm announced Monday.
Jones Day Names Tax Attorney as Partner-in Charge in Melbourne
Tax controversy attorney Niv Tadmore was promoted to partner-in-charge of the Melbourne office of Jones Day in Australia, the firm announced Monday.
Venable Brings on Matthew Hayes as Tax Partner in Chicago
Matthew Hayes joined Venable as a partner in the transactional tax group in Chicago, the firm announced Monday.
MFMac Appoints Claire Macpherson as Private Client Team Partner
Claire Macpherson joined MFMac as a partner in its private client team, the firm announced Tuesday.
NYU Tax Professor Polsky Joins Gunster as Of Counsel
Gregg Polsky joined Gunster as of counsel in its tax practice, the firm announced Tuesday.
Five Partners Join Norton Rose Fulbright in Midwest Expansion
Andrew Smolik, Michael Flood, Seth Aigner, Virginia Duong and Gordon Klein joined Norton Rose Fulbright as partners, the firm announced Feb. 2. Smolik and Flood joined the St. Louis office, while Aigner, Duong and Klein arrived in Chicago.
Greenberg Traurig Adds Philanthropy Lawyer to Grow Tax Practice
Molly Unterseher joined Greenberg Traurig as a shareholder in its tax-exempt organizations and philanthropy practice in Philadelphia and New York, the firm announced Thursday.
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