Friday, 13 December 2019

What is WEALTH TAX?

Wealth tax is unknown to those who live outside Europe. In Canada, USA and Panama there is no such tax. However in European countries such as Spain and France there is a wealth tax that takes up to 2.4% of your net worth. This is applied to both residents and non-residents who work there. It applies to all your profits, investments, savings and assets you accumulate during the year and you pay this every year.

Luckily there is no such tax in Canada and US. However this may change. One of the Democrats leadership candidates in US is proposing to add a Wealth Tax in US if she becomes president of United States in 2020 election. 

If you plan to move to Europe, you should check all the applicable taxes. Their system differs from Canada and US and that may affect your financial situation.

For example if you buy a property in Spain, aside from property tax, you also pay Rental Income Tax (between 1 to 2%) even if you do not rent your property. You will also pay up to 30% tax on the appreciation of the land value your house is built on, as well as up to 23% capital gain on selling the house.

Spain is a great place to visit and vacation in. I loved my vacation in Mallorca. It was amazing. Look at the mountains in this photo! They are heavenly!

I am currently in Madrid as I have to work on merging the admissions offices of National University of Medical Sciences in Madrid (Spain) with the one in Naples (Florida) in order to decrease our operational costs. After Madrid I have to visit Naples and spend some time in Florida before going home to Panama. 

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