It has nothing to do with taxation - or else the Arab Gulf or Cayman Islands would be entrepreneurial hubs, not California or the Toronto area. It’s all about the price of quality labour. It’s about access to long-term risk capital (aka venture funds) + high quality labour at affordable prices. As in, entrepreneurs having cash to fund projects and being able to actually hire people that will help build them. Try hiring a hundred software engineers in Norway: your hourly cost would probably blow up. The low-tax destinations are the place billionaires go to park their wealth, not create it (for example, outside of Tech Nordic billionaires move to Switzerland after they get rich)

> Try hiring a hundred software engineers in Norway: your hourly cost would probably blow up.

Depends what you’re comparing to. Total comp for great engineers in Oslo is lower than for their peers in Silicon Valley.

Total cost to the company may not be. Employees are costlier to the companies in Europe.

Also you get really great engineers in norway, something about the lack of light, cold, snowy eternal night, produces excellent devs. Lots of fantastic open source projects exist due to the vikings no longer using boats..

>" Try hiring a hundred software engineers in Norway"

They're not particularly cheap in the US either. Toronto might be better but hi-tech salaries are going up as well.

You can get 100s of SWE in Poland (or Ukraine pre-war) way cheaper than US, yet extreme cases of tech startups like FAANGs will never happen because market is too small.

You’re missing the wealth tax. 1.1% of global wealth, including unrealized gains of startup share positions.

https://www.skatteetaten.no/en/rates/wealth-tax/

I know a lot of founders whose companies are allegedly worth a lot on paper, but cash on hand is very limited.

I wonder how the wealth tax actually works. Do I want people to invest in my company if that's just going to increase the valuation and my tax bill? Surely there must be some exceptions...

This year, quite many have actually chosen to move from Norway to Switzerland, probably due to taxes

Not a problem for a startup surely, they have debts not wealth.

You need to look at the entire spectrum of direct, indirect and near-taxes. A couple of examples: VAT of 15-25% on almost everything. With social security contributions a maximum marginal tax rate on labour of more than 50%. Norway is actually pretty efficient and by far the best of the region compared with other countries but also massively subsidized with north sea oil money.