Europe Hits the Wallet: New Exit Tax

In 2025, Europe is showing a new trend: instead of simplifying tax regimes, countries are introducing additional barriers for those who wish to move capital abroad. The so-called “exit tax” is becoming a reality for wealthy citizens who plan to change their tax residency in favor of more favorable jurisdictions such as Dubai, Monaco, or Switzerland. This move aims to retain high-income taxpayers and prevent loss of budget revenues.

What is an “exit tax”?

The “exit tax” is a fiscal mechanism that requires a taxpayer to pay tax on unrealized capital gains before changing their tax residency. In other words, the state demands tax on potential profits that have not yet been realized but could be taxed in the future.

Germany: Up to 45% on Unrealized Gains

In Germany, the “exit tax” applies to individuals who own at least 1% of a company’s shares. Upon leaving the country, they are obliged to pay tax on the unrealized capital gains at a rate of up to 45%, including the solidarity surcharge. This tax can be paid immediately or deferred over seven years.

Norway: 38% and Limited Deferral Options

Norway tightened its “exit tax” rules in 2022. Taxpayers are now required to pay up to 38% on unrealized capital gains within 12 years of departure. Deferral is only possible under certain conditions, and if the taxpayer does not return to Norway during that period, the tax becomes mandatory.

Belgium: New Rules Effective July 1, 2025

Belgium is introducing a new “exit tax” that comes into effect on July 1, 2025. This tax will be 10% on unrealized capital gains on financial assets when changing tax residency or transferring assets to a non-resident. It applies to shares, bonds, investment funds, cryptocurrencies, and other financial instruments.

Comparative Table of Exit Tax Rates

Consequences for Businesses and Investors

The introduction of the “exit tax” complicates capital migration planning and changes to tax residency. Investors and entrepreneurs must carefully analyze the tax consequences before deciding to relocate. This may also impact Europe's attractiveness as a destination for investment and business operations.

Conclusion

The new wave of tax changes in Europe — particularly the introduction of the “exit tax” — is reshaping the rules for those considering a change of tax residency. This is a serious signal for investors, entrepreneurs, and high-net-worth individuals: capital migration is now not only a matter of strategic planning but also of tangible financial losses.

In this environment, having a reliable partner is essential. Get Legal Work assists citizens from South Asia and Africa in legally securing employment across European countries, supporting every step — from finding the right employer to handling documentation. We also provide consultations on safe and efficient relocation, taking into account the new tax obligations.