IMPULS Giulia Varaschin, Quentin Parrinello and Gabriel Zucman Wealth taxes and high-net-worth individuals in Europe Five Lessons for the Twenty-First Century Abstract What is the best way to tax high-net-worth individu­als(HNWI) in Europe effectively? Their wealth has grown over recent decades, but they are subject to lower effective tax rates than the average citizen. This brief reviews the history of net wealth taxes and comes up with five lessons for modern approaches to effectively taxing high-net-worth individuals. It shows that earlier wealth taxes raised limited reve­nue and failed to tax these individuals because of the narrow tax bases and low thresholds, not because of large-scale mobility. Modern systems should adopt broad tax bases without carveouts, target extreme wealth with high thresholds, use minimum-tax top­up mechanisms, include credible anti-exile rules, and leverage today’s transparency tools to tax high-net­worth individuals effectively. 1. Introduction Extreme wealth has grown dramatically in Europe over re­cent decades. According to estimates from the World Ine­quality Database, whereas in 1985 the richest 0.1 per cent of Europeans owned approximately 8.5 per cent of Europe’s total wealth, by 2025 the figure was approximately 11 per cent, almost four times as much wealth as the poorest 50 per cent. 1 At the same time, new evidence shows that high­net-worth households often face substantially lower effec­tive tax rates than the general population(Zucman 2024). This widening gap, combined with rising public investment needs and heightened public scrutiny of visible billionaire wealth, has renewed calls across Europe for wealth taxa­tion. However, Europe has implemented net-wealth taxes before, and many were subsequently repealed. Understand­ing how these earlier systems functioned, and where they failed, is essential to informing today’s debate on designing effective taxes on high-net-worth individuals(HNWIs). 1 Calculation based on data from the World Inequality Database. Wealth taxes and high-net-worth individuals in Europe 1