NBER

Kurt Schmidheiny

Universität Basel
Department of Economics and Business
Peter Merian-Weg 6
4002 Basel
Switzerland

E-Mail: kurt.schmidheiny@unibas.ch
Institutional Affiliation: Universität Basel

NBER Working Papers and Publications

June 2016Taxing Wealth: Evidence from Switzerland
with Marius Brülhart, Jonathan Gruber, Matthias Krapf: w22376
We study the effects of wealth taxation on reported wealth. Our analysis is based on data for Switzerland, which has the highest rate of annual wealth taxation in the developed world. While the wealth tax base is defined at the federal level, tax rates vary considerably across locations and over time. We use aggregate data on wealth holdings by canton and individual-level data for the canton of Bern. Our estimated behavioral elasticities substantially exceed those of the taxable income literature. We also find that taxpayers bunch below the tax threshold, that observed responses are driven by changes in wealth holdings rather than mobility, and that financial wealth is somewhat more responsive than non-financial wealth.

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