A new report commissioned by Brazil, the current president of the G20, has proposed a global tax on individuals with over $1 billion in assets. The 2% wealth tax is aimed at tackling inequality by ensuring the super-rich contribute their fair share to society.
A groundbreaking report commissioned by Brazil, the current president of the G20, has proposed a global tax on individuals with over $1 billion in assets. The 2% wealth tax is designed to address the growing inequality gap between the super-rich and the rest of the global population.
Proposed Global Tax on Super-Rich Aims to Address Inequality
According to the report, global billionaires currently pay a mere 0.3% of their wealth in taxes. This disparity has contributed to a widening wealth gap, particularly since the COVID-19 pandemic.
The proposed tax would target individuals with total assets exceeding $1 billion who do not already pay the equivalent of 2% of their wealth in income tax. The report estimates that the tax would generate $200-$250 billion annually from approximately 3,000 individuals worldwide.
Proposed Global Tax on Super-Rich Aims to Address Inequality
The revenue generated from the global tax could be used to fund crucial public services such as education, healthcare, and climate change mitigation. Gabriel Zucman, a French economist who authored the report, emphasized the importance of a progressive tax system in fostering social cohesion and trust in governments.
The report cites that billionaires currently own a combined 13% of the world's GDP, a significant increase from 3% in 1987. This concentration of wealth has led to growing concerns about inequality and the need for a more equitable distribution of resources.
Several G20 member nations, including the African Union, Belgium, Colombia, France, and Spain, have expressed interest in the proposal. Brazil, as the G20 president, has made addressing inequality a top priority alongside hunger reduction, sustainable development, and global governance reforms.
Felipe Antunes de Oliveira, from Brazil's Finance Ministry, acknowledged that implementing the tax would face challenges and negotiations could be protracted. However, he stressed that the funds generated would be invaluable in advancing Brazil's G20 agenda.
Anti-poverty organizations such as Oxfam International have welcomed the proposal, calling it "sensible and serious." The group emphasized that the tax is in the strategic economic interest of every government.
A 2023 study by the Tax Justice Network found that countries worldwide could lose up to $4.8 trillion in tax revenue over the next decade due to tax havens. The proposed global tax would help curb this revenue loss and ensure that the super-rich contribute their fair share to society.
The report's authors argue that the global tax would not only address inequality but also boost economic growth and stability. By ensuring that the super-rich pay their fair share, governments can reduce the burden on ordinary citizens and create a more equitable society.
