[flakeoil]

There are no special privilieges for the rich, as everyone has the same rules. It's actually better for the poorer in a sense as everyone is exempt to pay tax on profits on stock and dividends below a certain amount, 300000 SEK.

In Sweden you can invest your money in a special investment account which charges a certain fixed percentage each year on the amount you have in this account (cash and stocks). The percentage is based on the central bank interest rates (a special formula based on that) so it changes each year. In the past 10 years it has been around between 0.5-1% of the total amount you have in this account. Then all the profits you make are tax free as well as no tax on dividends and interest. You can't deduct losses though.

In Sweden there is no wealth tax and no inheritance tax.

EDIT: And for completeness, if you invest outside of the above mentioned type of account you have to pay 30% on profits and 30% on dividends and interests.

[lifestyleguru]

So a path to wealth for a normal person is being invested in capital markets but only through a "special" account and assuming that real estate rental or purchase will not eat every leftover from highly taxed monthly salary. This "special" account gives access to all major capital markets?

[flakeoil]

I'm not sure what you are after with you comment, but this account, of which the rules are decided by the authorities, is not that special as every bank and internet trader offers it and it is free and provides low cost Internet trading. And contrary to special pension accounts which exist in many countries, you can take out your money (and add) anytime you want. You just have to pay the tax percentage which is due. So you cannot really add and remove money too often as then you trigger this tax, but once a year is fine.

[johanneskanybal]

It's pretty universal in the developed world to have some type of long term savings tax-scheme. In us it's 401k/roth. In canada it's tfsa. in uk it's isa. isa/401k/roth has pretty low caps. tfsa and isk has no cap.

But yea, considering I pay close to 50% tax it's remarkable at the same time I can speculate in the market, make 500% and pay 1% tax on it. Or that people with actual money pay so little.

[MITSardine]

But 1% is on the total held, not on the capital gains, right?

If that's the case, it affects earnings quite a bit. Say your investments beat inflation by 3 percentage points, you're effectively down to 2 percentage points after tax, so a 33% reduction in income.

[johanneskanybal]

Yea it was better in the years of extremely low rates. 2020-2022 it was 0.375% of total. Now it's up to 0.888% last year. There's some cases where it might be benefitial to use the "normal" account but for average Joe, not having to track every transaction has generally been very benefitial. And as a result 80-90% of adults own some type of stock either directly or through funds/retirement accounts vs the free market utopia us of 62%.

[kzrdude]

The ISK rules and taxes are relevant for a middle class I think. This was a question about the really rich.. then we need to look at taxes on capital gains, dividends, corporate tax et.c.

[boxed]

"everyone has the same rules" and "no special privileges" seems disingenuous to say. In both directions! Progressive tax codes are "the same" for "everyone", but obviously will mean the rich pay more. Now you can argue that's unfair or that it's extremely fair, but it's at least different!

[flakeoil]

But there is no progressive tax in this account. It is a percentage of what you have in the account. Same percentage for everyone. It's just that starting in 2026 they decided to make it tax free for the first 300000 SEK (about 30000 USD) you have in this account.

[boxed]

That's literally a progressive tax.