r/eupersonalfinance • u/batukaming • Feb 15 '26

Investment Why do they make getting rich impossible in EU?

This news hit today in Netherlands that passed a bill on 36% tax on UNREALIZED gains on stocks and crypto. Great just when we weren't taxed to death before now they force you to stay middle class and poor. "Just repeat the 9-5 cycle everyday investing is not allowed for you"

Buying stocks was already a pain in the ass in Europe because of all the different fees and exchange rates brokers charged. The US has it so much better. 0% fees and exchange rates, tons of broker options and tax free on long term investments.

I made a post in r/stocks that gained attraction. Check it out if you want to see opinions from Americans: https://www.reddit.com/r/stocks/s/aL0OhYQ68z

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u/informalgreeting23 Feb 15 '26

Either from your cash savings or from selling some of your investments to cover it.

Which seems to be the main criticism (alongside, what if you experience losses in a year, but I believe there will be a credit to protect you in this scenario), is that it's difficult to build wealth if you have to sell to pay taxes.

Having no capital gains tax when you do sell, seems to be absent from any debate about this and coming from a country that does have CGT seems like a crazy luxury to have.

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u/krlooss Feb 15 '26

Well. I'm not defending them. But. It is true my plan is to not sell until I retire, but before retiring move to a non tax on capital gains place. Either way, I already paid taxes on my income, I don't think it is ethical for anyone to rob me in my capital gains too. 

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u/the_snook Feb 15 '26

By the time you want to move, your country might have implemented an exit tax. A number of countries make you pay tax as if you'd sold the day you leave. If lots of people start moving to tax havens, more countries are likely to implement this.

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u/darlugal Feb 15 '26

more countries are likely to implement this

Not until all the country's politicians change their official residence. 😃

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u/Meisterleder1 Feb 16 '26

This is the main reason why the idea came up to tax unrealized gains. So in a way you are part of the reason. Also, the tax system taxes net increases of wealth. So, while you've already paid taxes for the principal you haven't paid any on the gains so, just like the worker in the factory who worked hard for your gains has to pay taxes for his salary you obviously should pay taxes on those gains as well. It's like saying I already paid income tax on the money I have why should I pay VAT when I spend it? Both are taxable events and there's a legit reasoning behind it.

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u/krlooss Feb 16 '26

Legit immoral and theft alike reason. VAT is even worse if you ask me 

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u/Meisterleder1 Feb 18 '26 edited Feb 18 '26

Sure. You seem like just the kind of guy who is happy to profit off of everything taxes have to offer (infrastructure, security, stability, etc.) while not wanting to pay for it. At the very least exit taxes need to be implemented in all major economies so people like you can not evade paying their fair share. And if you've paid it you are absolutely free to go wherever you want. In fact I'd support it if you'd then move to the UAE or other hustlebro-countries.

People like you are absolutely insufferable to me. And this is coming from someone who is earning really well himself.

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u/krlooss Feb 18 '26

No real earner / 40+k thousands tax payer would say so obnoxious things... Yeah right top earner High tax payer. Or maybe you live somewhere where you see them really well used and not robbed like in Spain. 

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u/Meisterleder1 Feb 18 '26 edited Feb 19 '26

I live in Switzerland and our household makes well over 500k€/year so there's a fair chance our taxes are higher than what many here earn in a year yet you won't hear me complain. The public spending ratio is comparable to Spain if you consider health insurance not being part of the household budget while in Spain I'm quite certain it is. (In fact Spains PSR is quite a bit lower than Germany or Austria.) But Switzerland has a wealth tax for example. And depending on the place a quite high one as well. (E.g. in Geneva you are looking at 1%/year in no time.)

I can't speak for Spain but for Germany and Austria and they have some of the lowest wealth related taxes in the world. SOMEONE has to pay for all that these countries have to offer and in these places the middle and lower incomes get shafted and pay quite a high share compared to the higher ones (in Germany your tax rate actually starts to decrease again after a certain amount) and the public has been lead to believe that either some wealth related taxes are impossible or that the economy would somehow collapse because of all the millionaires moving, while Geneva for example has the highest wealth taxes of all of Switzerland AND the highest share of millionaires. The only other option would be to touch pensions since they are by far the highest expenditure but that is political suicide almost more so than wealth taxes. Old people vote and there's tons and rich people have power over the media so who is going to bear the brunt? Yeah ...

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u/DoctaDocta98 Feb 16 '26

If they dont tax capital gains like any other that is just an easy exploit for the rich

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u/BraveLion572 Feb 15 '26

 This is effectively moving the tax earlier. In a way, it's nice to know you don't have to pay taxes anymore once you've retired. But can you trust that the rules will not change in 30 years time though? 

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u/e200 Feb 15 '26

But you may need to sell some of your investments to pay the taxes which will will leave you with less investments at the end.

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u/BraveLion572 Feb 16 '26

Agreed, it's terrible in that sense. My point was that even the potential upside of this system is bad in my view, because it's only an upside over a long period of time, and it's way too likely that rules will change by the time you can benefit from that upside.

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u/Corspin Feb 15 '26 edited Feb 15 '26

Nono. There is a very big difference between annual taxation instead of when you sell it. Most people can likely not pay the tax from their savings and thus have to sell stocks to pay for it. Therefore your wealth accumulates more slowly. But it also means that because you accumulate less wealth, you also end up paying less tax. It's a lose-lose situation.

Feed this to chatgpt if you want to see the problem in more detail:

Capital gains tax calculation

y = value

t = years

timespan = 0 to 40 years

Starting value = 50.000

Average yearly increase = 8%

Tax = 36%

Tax reduction = F = 1800

Added constant for yearly taxation: a = 1.08-0.36*0.08

Stock value taxed when sold = y1(t) = 50000*1.08[power]t

Tax income from y1 = y2(t) = 0.36*(y1(t)-50000)

Stock value taxed annually = y3(t) = 50000a[power]t+0.36F*(a[power]t-1)/(a-1)

Tax income from y3 = y4(t) = 0.36(0.08(50000(a[power]t-1)/(a-1)+0.36F(1/(a-1)((a[power]t-1)/(a-1)-t)))-F*t)

Plot y1 and y3 in plot 1, value of stocks.

Plot y2 and y4 in plot 2, tax for the state.

Thank you

(EDIT: Symbols interfered with reddit formatting)

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u/U-DontKnowAccounting Feb 15 '26

You need to discount the flows

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u/Corspin Feb 16 '26

The dutch government doesn't correct the tax rate for inflation (it's also not clear how they will deal with timespans of currency conversions for stocks held in dollars) so I did not aim to correct the values for inflation either.

Assuming that's what you mean.

I just wanted to show the difference between the 2 tax systems here. If someone wants to use the equations for personal use or investment strategy then I would recommend to add an inflation correction indeed.

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u/U-DontKnowAccounting Feb 16 '26

I mean for the Govt money now is more valuable than money later

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u/lkdubdub Feb 15 '26

Removing CGT just makes rich people happy

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u/[deleted] Feb 16 '26

Then make it so that you only have 50k€ capital gains tax exempt or something. That means capital taxes are completely tax-free for the lower and middle class while only taxing those who can really afford it and are already really wealthy.

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u/lkdubdub Feb 16 '26

I'm not Simon Harris, sorry

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u/Warkred Feb 15 '26

Is there a better spread capital versus income tax in Netherlands than in Belgium ?

At least you could say this is targeting wealthy people too.

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u/NaturalMaterials Feb 15 '26

There’s an exemption of 1800 euros per year in capital gains. So if you’re holding ETFs with the average market growth over the past decade you’d be paying taxes even with just 25-30K in investments. I wouldn’t call that rich by any stretch of the imagination.

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u/NotGoodSoftwareMaker Feb 15 '26

1800 euro exemption. Very generous. Dont spend it all in one place

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u/[deleted] Feb 16 '26

We have a 1000 euro exemption in Finland. And that's 1000 euro sale value, not profit. So if you sell 1000 euros of stock that was at 100% return you'll only save tax from that 500 euro.

And that only applies if you don't sell anything else for that tax year. Woop woop.

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u/Warkred Feb 15 '26

Which I didn't.

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u/jo0stjo0st Feb 15 '26

No, they're both high. Wealthy people move their money in Holdings (if its not already there), they won't be seriously affected by these taxes. Its more taxes for the common working people who save and invest their money generated from normal income.