Abstract
The literature concerning the settlement choices of wealthy taxpayers has emphasised differences in tax rates and proximity to other wealthy individuals respectively. In this article, we explore the significance of these explanations through a mapping of wealthy Swedes living in Switzerland in the 1960s–1980s period. In the decades after the Second World War, Switzerland became a popular destination for foreign tax emigrants, while Swedish taxation on income and wealth became more progressive. We base our study on never-used-before records of all Swedes living in Switzerland during this period, combined with archive material and other sources on the tax regimes of the Swiss cantons. Our findings suggest that both the tax rates and the proximity to other wealthy individuals—and opportunities for social and business networking—can explain the settlement of wealthy Swedish expatriates in Switzerland. Overall, a large proportion of the Swedish emigration to Switzerland was related to tax rates. More specifically, Swedes settled in cantons with comparatively low-tax rates and/or with lump-sum taxation of wealthy foreigners. Furthermore, the wealthy Swedes were clustered in a few particular cantons in which a large proportion of well-off people lived, which suggests that they also favoured living close to other wealthy expatriates. The study contributes to the research on the settlement choices of the wealthy and on tax avoidance and evasion.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
Notes
- 1.
The World’s Billionaires’ Ranking, Forbes, April 2021: Switzerland, nr. 7: 40 billionaires, Sweden, nr. 9: 41 billionaires.
- 2.
OECD, Revenue Statistics 1965–2008, Paris: OECD, 2009, pp. 75–78 (Tax Levels and Tax Structures, 1965–2007, Table 3 Comparative Tables).
- 3.
The term ‘skatteschweizare’ was used by the Social Democratic Prime Minister Olof Palme to blame the Swedish expatriates for deciding the tight general election of 1979, which resulted in a Conservative majority. Henrik Oscarsson, ‘Utlandröstande’, in Svenska Utlandsröster SOM-Undersökningen till Utlandssvenskar 2014 SOM-Rapport Nr 65, ed. Maria Solevid (SOM-institutet, 2016), 259–285.
- 4.
Statens Offentliga Utredningar 1975, 50 Internationella koncerner i industriländer—Samhällsekonomiska aspekter, Betänkande av Koncentrationsutredningen.
- 5.
Statens Offentliga Utredningar 1975, 50 Internationella koncerner i industriländer, samhällsekonomiska aspekter. Betänkande av Koncentrationsutredningen, Göteborgs Offsettryckeri, Stockholm.
- 6.
Bulletin sténographique du Conseil national, Réponse de Nello Celio à Motion Reich, Pauschalsteuer Abschaffung, 04.06.1973, pp. 450–451.
- 7.
The founder of IKEA, Ingvar Kamprad (1926–2018), moved to Epalinges on 1 July 1977. Interestingly, his previous official residence was in Denmark (not in Sweden). He left the commune and returned to Sweden on 1 March 2014. His departure, which took place in the middle of a heated political campaign on a federal vote to abolish the preferential tax regime for wealthy foreigners, did not generate a decrease in tax revenues of the commune. On the contrary, Kamprad’s departure was compensated by the arrival of two new foreign lump-sum taxpayers. (Source: Minutes of the conseil communal d’Epalinges, 11.11.2014, Discussion on the 2015 budget, pp. 334–335).
- 8.
Eidg. Steuerverwaltung Steuererträge und Kopfquoten 1981/82. Available online: https://www.estv.admin.ch/dam/estv/fr/dokumente/allgemein/Dokumentation/Zahlen_fakten/Steuerstatistiken/direkte_bundessteuer/np_jp_kopfquoten/Steuerertraege%20und%20Kopfquoten%201981%2082.pdf.download.pdf/81-82_f.pdf.
- 9.
See source of Fig. 6.4.
- 10.
Despite the rejection (59.4% of the votes) in a popular vote of a federal initiative to abolish expenditure-based taxation at the national level in 2014, some cantons, namely Zurich (2010), Schauffhausen (2012), Appenzell I.Rh. (2012), Basel-Stadt (2014), and Basel-Land (2014) have decided to abolish it at the cantonal level.
- 11.
This may be due to the lower quality, in terms of detail, of the lists produced by the Zurich and Basel offices.
Bibliography
Afonso, Whitney B. 2018. The Effect of a State Income Tax on Migration: The Example of Connecticut. Journal of Public Policy 38 (1): 113–140. https://doi.org/10.1017/S0143814X16000234.
Akcigit, Ufuk, Salomé Baslandze, and Stefanie Stantcheva. 2016. Taxation and the International Mobility of Inventors. American Economic Review 106 (10): 2930–2981. https://doi.org/10.1257/aer.20150237.
Barham, Kevin, and Claudia Heimer. 1998. ABB: The Dancing Giant: Creating the Globally Connected Corporation. London: Financial Times Pitman Publ.
Baselgia, Enea, and Isabel Martínez. 2022. Tracking the Super-Rich: Insights from Swiss Rich Lists. CESifo Working Paper No. 9778, https://doi.org/10.2139/ssrn.4135944.
Bernasconi, Marco. 1983. Die Pauschalbesteuerung: eine Darstellung der Bestimmungen des eidgenössischen Rechts, des Rechts der schweizerischen Kantone... Schweizer Schriften zum Handels- und Wirtschaftsrecht Bd. 69. Zürich: Schulthess Polygraphischer Verl.
Brülhart, Marius, Didier Dupertuis, and Elodie Moreau. 2018. Inheritance Flows in Switzerland, 1911–2011. Swiss Journal of Economics and Statistics 154 (1): 8. https://doi.org/10.1186/s41937-017-0012-9.
Farquet, Christophe. 2016. La Défense Du Paradis Fiscal Suisse Avant La Seconde Guerre Mondiale: Une Histoire Internationale. Neuchâtel: Alphil.
Feldstein, Martin, and Marian Vaillant Wrobel. 1998. Can State Taxes Redistribute Income? Journal of Public Economics 68 (3): 369–396. https://doi.org/10.1016/S0047-2727(98)00015-2.
Flury-Dasein, Eric. 2004. Die Schweiz und Schweden vor den Herausforderungen des Kalten Krieges 1945-1970 : Neutralitätspolitik, militärische Kooperation, Osthandel und Korea-Mission. Schweizerische Zeitschrift für Geschichte 54 (2): 123–45. https://doi.org/10.5169/SEALS-81363.
Giddey, Thibaud, and Mikael Wendschlag. 2022. Tax System Credibility vs. Banking System Reputation? Tax Evasion from Sweden to Switzerland in the Early 1970s. In Not Paying Taxes. Tax Evasion, Tax Avoidance and Tax Resistance in Historical Perspective, ed. Gisela Hürlimann, Dorothea Rohde, and Korinna Schönhärl. Springer Studies in Economic History Series. Springer.
Gubler, Eduard. 1949. Pauschalierung Der Eidg. Wehrsteuer. Steuer-Revue 4: 96–100.
Guex, Sébastien. 2000. The Origins of the Swiss Banking Secrecy Law and Its Repercussions for Swiss Federal Policy. Harvard Business History Review 74 (2): 237–266.
Guex, Sébastien. 2021. The Emergence of the Swiss Tax Haven, 1816–1914. Business History Review 1–20. https://doi.org/10.1017/S0007680520000914.
Harrington, Brooke. 2021. Secrecy, Simmel and the New Sociology of Wealth. Sociologica 15 (2): 143–152. https://doi.org/10.6092/issn.1971-8853/13565.
Henrekson, Magnus. 2017. Taxation of Swedish Firm Owners: The Great Reversal from the 1970s to the 2010s. Nordic Tax Journal 2017 (1): 26–46. https://doi.org/10.1515/ntaxj-2017-0002.
Herren, Madeleine. 2016. International Organizations, 1865–1945. In The Oxford Handbook of International Organizations, ed. Jacob Katz Cogan, Ian Hurd, and Ian Johnstone, 91–112. Oxford University Press. https://doi.org/10.1093/law/9780199672202.003.0004.
Hürlimann, Gisela. 2017. Swiss Worlds of Taxation: The Political Economy of Fiscal Federalism and Tax Competition. In The Political Economy of Public Finance: Taxation, State Spending and Debt since the 1970s, ed. Alexander Nützenadel, Marc Buggeln, and Martin Daunton, 83–104. Cambridge: Cambridge University Press. https://doi.org/10.1017/9781316498958.004.
Kleven, Henrik Jacobsen, Camille Landais, and Emmanuel Saez. 2013. Taxation and International Migration of Superstars: Evidence from the European Football Market. American Economic Review 103 (5): 1892–1924. https://doi.org/10.1257/aer.103.5.1892.
Kleven, Henrik Jacobsen, Camille Landais, Emmanuel Saez, and Esben Schultz. 2014. Migration and Wage Effects of Taxing Top Earners: Evidence from the Foreigners’ Tax Scheme in Denmark. The Quarterly Journal of Economics 129 (1): 333–378. https://doi.org/10.1093/qje/qjt033.
Kleven, Henrik Jacobsen, Camille Landais, Mathilde Muñoz, and Stefanie Stantcheva. 2020. Taxation and Migration: Evidence and Policy Implications. Journal of Economic Perspectives 34 (2): 119–142. https://doi.org/10.1257/jep.34.2.119.
Lantz, Gunnar. 2021. Letting the Masses Pay for the Welfare State: Tax Regressivity in Postwar Sweden. European Review of Economic History 25 (1): 160–179. https://doi.org/10.1093/ereh/heaa007.
Lillie, Karen. 2022. Adaptations to Global Changes: Strategic Evolutions of an Elite School, 1961–2011. History of Education 51 (2): 1–18. https://doi.org/10.1080/0046760X.2021.2002433.
Lindkvist, Hans. 1990. Kapitalemigration. Stockholm: Ekonomiska forskningsinstitutet vid Handelshögsk (EFI).
Longchamp, Olivier. 2014. La politique financière fédérale (1945–1958). Lausanne: Antipodes.
Lüthi, Carol Gregor. 2017. Lump-Sum Taxation in Switzerland: A Systematic Classification into Swiss Tax Law with Current References. Norderstedt: Books on Demand.
Mahnig, Hans, and Sandro Cattacin, eds. 2005. Histoire de la politique de migration, d’asile et d’intégration en Suisse depuis 1948. Sozialer Zusammenhalt und kultureller Pluralismus = Cohesion sociale et pluralisme culturel = Social cohesion and cultural pluralism. Zurich: Seismo.
Ogle, Vanessa. 2017. Archipelago Capitalism: Tax Havens, Offshore Money, and the State, 1950s–1970s. The American Historical Review 122 (5): 1431–1458. https://doi.org/10.1093/ahr/122.5.1431.
Oscarsson, Henrik. 2016. Utlandröstande. In Svenska Utlandsröster SOM-Undersökningen till Utlandssvenskar 2014 SOM-Rapport Nr 65, ed. Maria Solevid (SOM-institutet), 259–85.
Piketty, Thomas, and Emmanuel Saez. 2007. How Progressive Is the U.S. Federal Tax System? A Historical and International Perspective. Journal of Economic Perspectives 21 (1): 3–24. https://doi.org/10.1257/jep.21.1.3.
Sanandaji, Tino. 2014. The International Mobility of Billionaires. Small Business Economics 42 (2): 329–338. https://doi.org/10.1007/s11187-013-9481-0.
Schmidheiny, Kurt. 2017. Emerging Lessons from Half a Century of Fiscal Federalism in Switzerland. Swiss Journal of Economics and Statistics 153 (2): 73–101. https://doi.org/10.1007/BF03399435.
Schmidheiny, Kurt, and Michaela Slotwinski. 2018. Tax-Induced Mobility: Evidence from a Foreigners’ Tax Scheme in Switzerland. Journal of Public Economics 167 (November): 293–324. https://doi.org/10.1016/j.jpubeco.2018.04.002.
Slemrod, Joel, and Shlomo Yitzhaki. 2002. Tax Avoidance, Evasion, and Administration. In Handbook of Public Economics, ed. Alan J. Auerbach and Martin Feldstein, 3: 1423–1470. Elsevier. https://doi.org/10.1016/S1573-4420(02)80026-X.
Strehle, Res. 2020. Operation Crypto: Die Schweiz im Dienst von CIA und BND, 1st ed. Basel: Echtzeit Verlag.
Svenska Kyrkan i Schweiz. 50 År 1961 - 2011. 2011. https://docplayer.se/40373760-Svenska-kyrkan-i-schweiz-50-ar-en-historisk-kavalkad-i-tre-delar-de-forsta-20-aren-skut-tar-over-och-2000-talet.html.
Swann, Michelle. 2007. Promoting the “Classroom and Playground of Europe”: Swiss Private School Prospectuses and Education-Focused Tourism Guides, 1890–1945. University of British Columbia. https://doi.org/10.14288/1.0055448.
Tanner, Jakob. 2020. Sweden – Switzerland: The Entangled History of Two like-Minded Countries. https://doi.org/10.5167/UZH-194558.
Vogel, Joachim. 1974. Taxation and Public Opinion in Sweden: An Interpretation of Recent Survey Data. National Tax Journal 27 (4): 499–513.
Young, Cristobal. 2017. The Myth of Millionaire Tax Flight: How Place Still Matters for the Rich. Studies in Social Inequality. Redwood City: Stanford University Press.
Young, Cristobal, Charles Varner, Ithai Z. Lurie, and Richard Prisinzano. 2016. Millionaire Migration and Taxation of the Elite: Evidence from Administrative Data. American Sociological Review 81 (3): 421–446. https://doi.org/10.1177/0003122416639625.
Acknowledgment
We would like to thank Hadrien Buclin and Sébastien Guex for their valuable feedback, as well as Martin Grandjean for his substantial help with the maps and correlation chart visualisations.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2023 The Author(s), under exclusive license to Springer Nature Switzerland AG
About this chapter
Cite this chapter
Giddey, T., Wendschlag, M. (2023). Swedish Emigration to Switzerland in the 1960s–1980s Period: Tax Exile and Settlement Choices. In: Guex, S., Buclin, H. (eds) Tax Evasion and Tax Havens since the Nineteenth Century. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-18119-1_6
Download citation
DOI: https://doi.org/10.1007/978-3-031-18119-1_6
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-031-18118-4
Online ISBN: 978-3-031-18119-1
eBook Packages: HistoryHistory (R0)