DEFINITION of 'Wealth Tax'

It is a tax based on the market value of assets that are owned. These assets include, but are not limited to, cash, bank deposits, shares, fixed assets, private cars, assessed value of real property, pension plans, money funds, owner occupied housing and trusts. An ad valorem tax on real estate and an intangible tax on financial assets are both examples of a wealth tax. Although many developed countries choose to tax wealth, the United States has generally favored taxing income.


Wealth tax is imposed on the wealth possessed by individuals in a country. The tax is on a person's net worth which is assets minus liabilities. Not all countries have this type of tax; Austria, Denmark, Germany, Sweden, Spain, Finland, Iceland and Luxenberg have abolished it in recent years. The United States doesn't impose wealth tax but requires income and property taxes.

  1. Property Tax

    A tax assessed on real estate by the local government. The tax ...
  2. Tax Rate

    A tax rate is the percentage at which an individual or corporation ...
  3. Real Asset

    A real asset is a physical or tangible asset, such as gold, real ...
  4. Income Tax

    A tax that governments impose on financial income generated by ...
  5. Fixed Asset

    A fixed asset is a long-term tangible piece of property that ...
  6. Reassessment

    The process of redetermining the value of a parcel of real estate ...
Related Articles
  1. Managing Wealth

    Are You Earning Income or Building Wealth?

    Simply having income does not mean that you also have significant wealth.
  2. Taxes

    Taxes: Who Pays And How Much?

    When it comes to taxes, the debate is endless on who pays what, especially in Congress. With no new initiatives in sight, let's take a look at who is paying now.
  3. Taxes

    Countries with the Highest Income Taxes

    Before you move to one of these countries with the highest income taxes, think through the overall tax situation - and what you get for your money.
  4. Taxes

    5 States Without Sales Tax

    Learn about the five states that do not charge sales taxes and about other taxes the states levy instead in order to generate revenue.
  5. Managing Wealth

    How Trump Tax Plans Will Aid Wealth Building for the 1%

    President-elect Trump's proposed tax plan includes tax breaks that may offer some generous benefits to higher-income earners.
  6. Financial Advisor

    How Big Is the Wealth Management and Financial Advisor Industry?

    Learn about the world's $74 trillion in managed assets, and why the wealth management industry is drastically different following the financial crisis of 2007-2008.
  7. Taxes

    9 States Where You'll Pay the Most in Taxes

    Which state you live in can mean thousands of dollars saved or lost in taxes each year. Here's a list of states to avoid when it comes to tax rates.
  8. Taxes

    Use Tax Vs. Internet Sales Tax: How Are They Different?

    Learn about the differences between a use tax and an Internet sales tax. Find out about transactions in which the taxes apply, and to whom they apply.
  9. Taxes

    How Much Tax Do You Really Pay?

    When you add direct and indirect taxes together, your real tax rate is much more than you expected.
  10. Taxes

    Income Tax Planning Is the New Estate Tax Planning

    Use these strategies to minimize your family’s income taxes through your estate plan.
  1. What are the differences between regressive, proportional, and progressive taxes?

    Learn about the three basic types of tax systems, all of which are used in the U.S., and how they affect different income ... Read Answer >>
  2. What is the difference between a state income tax and a federal income tax?

    Learn the difference between state income tax and federal income tax based on tax rates, deductions, tax credits and taxable ... Read Answer >>
  3. What are the best and worst states to pay taxes in?

    Explore and compare the wide variations that exist in the overall tax burden imposed by different states, including which ... Read Answer >>
Hot Definitions
  1. Standard Deviation

    A measure of the dispersion of a set of data from its mean, calculated as the square root of the variance. The more spread ...
  2. Entrepreneur

    An Entrepreneur is an individual who founds and runs a small business and assumes all the risk and reward of the venture. ...
  3. Money Market

    The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
  4. Perfect Competition

    Pure or perfect competition is a theoretical market structure in which a number of criteria such as perfect information and ...
  5. Compound Interest

    Compound Interest is interest calculated on the initial principal and also on the accumulated interest of previous periods ...
  6. Income Statement

    A financial statement that measures a company's financial performance over a specific accounting period. Financial performance ...
Trading Center