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Norway’s top personal tax rate is similar to the US (39%, which is less than what some people pay in high cost of living states here). The difference, as I’m s
by dev_dull 7y ago
Norway’s top personal tax rate is similar to the US (39%, which is less than what some people pay in high cost of living states here).
The difference, as I’m sure you already know, is state oil revenue, and that can’t last forever even with sovereign wealth funds.
- pnako 7y agoWhy not? You could have a welfare system that redistributes any excess return from the fund above long-run inflation rate, and it would be sustainable.
- AnthonyMouse 7y agoA significant fraction of the historical rate of return on capital is attributable to the combination of population growth and inflation. Without those the size of the fund you would need to cover a material fraction of government spending would be implausibly large. Sovereign wealth funds also aren't all that different economically from taxation, in the sense that the profits from what the fund is invested in go to funding government programs rather than being reinvested in private enterprise. If the fund was large enough to be relevant, that would become an issue for the economy.
- Arn_Thor 7y agoSweden, Finland and Denmark are also very apt examples, none of whom have oil. (Norway also uses very little of its oil revenue, saving most of it)