Martin Varsavsky is one of more than 12,000 multimillionaires living in Spain who were blindsided by a “solidarity” tax at the end of 2022.
Pedro Sánchez’s Socialist government introduced a temporary levy of 1.7pc on citizens whose net wealth exceeds €3m (£2.6m) rising to 3.5pc for those worth €10m or more.
The Argentine-born Varsavsky, who has founded five billion-dollar companies spanning telecoms to renewable energy, was hit by a significant tax bill.
“I felt cheated,” he says.
The 64-year-old, who now runs a network of fertility clinics in North America, says he’s thought about leaving Madrid ever since.
“I went to visit Portugal, Italy and also Florida, where I used to live,” Varsavsky says.
“What’s especially egregious in my case is that now I make all my money in the US. So Spain is making all this money out of me. So I have all the incentives in the world to move away, and I will.”
Some have already gone. The “impuesto de solidaridad a las grandes fortunas” raised just €632m in 2022, representing 0.1pc of all taxpayers in Spain.
Despite the relatively low yield, Labour’s union paymasters are already calling for the UK Government to follow suit. The Tax Justice Network claims as much as £24bn a year could be raised from the UK if it copied Spain’s model.
Sharon Graham, the leader of Unite, has urged Rachel Reeves, the Chancellor, to announce a 1pc tax on Britain’s richest 1pc. “It’s time for a wealth tax on the super-rich and a tax on excess profits. We don’t need more excuses about fiscal responsibility or talk of wealth creation,” Graham said last month.
The G20 is also exploring plans for a global minimum tax on the world’s 3,000 billionaires.
The drive is being led by Gabriel Zucman, the tax guru behind US senator Elizabeth Warren’s proposal of a 2pc levy on the world’s richest. He claims it could unlock $250bn (£189bn) a year.
However, the issue remains highly contentious, and revenues have usually disappointed.
Esther Villa, a lawyer at Osborne Clarke in Barcelona, says the levy had a chilling effect on Spain’s entrepreneurs.
“The initial response from many of my clients was a feeling of being punished for being successful.” But she also notes that initial revenues were disappointing.
“When the solidarity tax was adopted, the government made a big deal of what they expected to collect, but what was collected in 2023 is less than half what was anticipated,” adds Villa.