When Countries Tax Paper Gains, Capital Packs Its Bags 🇳🇱🛩️
What the Netherlands can learn from the UK’s millionaire exodus — and what investors should learn first.
36% on paper profits!
Yes, you read that right. A tax on “gains” you haven’t realised yet.
If you lived in the Netherlands and your portfolio rose €200,000 this year, you could owe tax on that gain — even if you never sold a single share.
That is not a dramatic exaggeration. It is the direction of policy.
From 2028, the Netherlands plans to tax actual returns in Box 3 at 36 percent, including unrealised gains on stocks, bonds and crypto. Not realised gains. Unrealised gains. Valuation-based taxation.
That distinction matters more than most headlines suggest.
For decades, long-term investors have operated under one simple principle: you pay capital gains tax when you sell. Liquidity triggers taxation. Until then, capital compounds uninterrupted. Time and stability do the heavy lifting.
If valuation becomes taxable income, compounding becomes conditional.
Imagine a €1 million portfolio growing to €1.2 million in a strong year. Under a 36 percent framework, roughly €72,000 could be due. The capital remains invested. The gain exists only on paper. But the tax bill is real.
Now volatility is no longer just emotional. It becomes fiscal.
If markets rise strongly one year and correct the next, you may have paid tax on gains that later disappear. That distorts behaviour. Investors shorten holding periods. They reduce exposure to growth assets. They become more defensive.
And the most mobile among them begin to ask a different question.
Do I need to remain resident here?
We have just watched this dynamic unfold in the United Kingdom. Following changes to the non-dom regime and tighter capital taxation, the UK is projected to lose more high-net-worth individuals than any other country in 2025. According to the Henley Private Wealth Migration Report 2025, the UK is set to lose 16,500 millionaires this year, the largest net outflow globally:
https://www.henleyglobal.com/publications/henley-private-wealth-migration-report-2025/what-driving-uks-millionaire-exodus
Wealth does not protest.
It relocates.
Here are some of the options wealthy investors and business owners are choosing.
