New tax call for super-rich after 1% of new wealth pockets two-thirds of all new wealth | inequality

Oxfam has called for urgent action to tackle the post-Covid expansion in global inequality, after announcing that nearly two-thirds of the new wealth accumulated since the start of the pandemic went to the richest 1%.

In a report coinciding with the annual meeting of the global elite at the World Economic Forum in Davos, the charity said the best-off had pocketed $26 trillion (£21 trillion) of new wealth by the end of 2021. This represented 63%. the rest goes to the remaining 99% of people.

Oxfam said for the first time in a quarter of a century that the rise in extreme wealth was accompanied by an increase in extreme poverty and called for new taxes on the super-rich.

Policies put in place to combat the economic impact of Covid 19, such as interest rate cuts and the money creation process known as quantitative easing, have increased the value of properties and shares that tend to own. richer people.

According to the report, for every $1 of new global wealth earned by a person in the bottom 90 percent over the past two years, each billionaire It earned roughly $1.7 million. Despite small declines in 2022, the total wealth of billionaires increased by $2.7 billion per day. The pandemic gains come after a decade in which both the number and wealth of billionaires doubled.

Danny Sriskandarajah, CEO of Oxfam GB: “The current economic reality is an affront to basic human values. Extreme poverty is on the rise for the first time in 25 years and close to a billion people are starving, but for billionaires it’s a blessing every day.

“As multiple crises bring millions to the brink, our leaders fail to grasp the point – governments must stop acting in the vested interests of the few.

“How can we accept a system in many countries where the poorest people pay much higher tax rates than the super-rich? Governments must now impose higher taxes on the super-rich.”

Oxfam said excessive wealth concentration has led to weak growth, corrupting politics and the media, eroding democracy and political polarization. super rich The charity added who are the biggest contributors to the climate crisis, with a billionaire emitting a million times more carbon than the average person. Compared to the average investor, they were also twice as likely to invest in polluting industries.

The report urged governments to immediately introduce one-off wealth taxes on the richest 1%, along with unexpected taxes, to limit profiteering during the global cost of living crisis. Then there should be a permanent increase in wealth taxes with higher rates for multimillionaires and billionaires.

In support of the call for wealth redistribution, Oxfam said:

  • Food and energy companies doubled their profits in 2022, paying $257 billion to wealthy shareholders at a time when more than 800 million people were starving.

  • Only 4 cents per dollar of tax revenue came from wealth taxes, and half of the world’s billionaires lived in countries where there was no inheritance tax on the money they gave to their children.

  • A tax of up to 5% on the world’s multimillionaires and billionaires could raise $1.7 trillion a year, enough to lift 2 billion people out of poverty and fund a global plan to end hunger.

Colombian finance minister José Antonio Ocampo said in the preface to the report: “Taxing the richest is no longer an option, it’s a necessity. Global inequality has exploded and there is no better way to tackle inequality than to redistribute wealth.”

Justice is at the heart of Colombia’s tax reforms. Concretely, this means a new wealth tax, higher taxes for high incomes and large corporations making extraordinary profits in international markets, and the end of tax incentives that exist without a clear social or environmental justification.

“Also, based on the international tax treaty, we enforce digital services taxes and adopt the minimum tax rate for corporations.”

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