Pressure is piling on the G20 to lead a global push to increase taxes on the richest citizens back to past levels that most people believe were fairer and more useful for society.
Without this adjustment extreme wealth and inequality will continue to skyrocket. In the last decade, billionaires have more than doubled their wealth, from $5.6 to $11.8 trillion.
In an open letter to the G20, close to 300 millionaires, economists, and political representatives from almost all G20 countries call for a new international agreement on wealth taxes to “stop extreme wealth from corroding our collective future”. It says that people all over the world are “desperate for change”.
Money, knowledge, and power are united in calling for action, and for the G20 to put taxing the wealthiest at the heart of their agenda at their upcoming Summit meeting in India, and beyond.
Signatories include Disney heiress Abigail Disney, ex-leaders of Belgium, Denmark, Croatia, Czech Republic and Bulgaria, US representative Brendan Boyle, former and current European parliamentarians including Aurore Lalucq and Pascal Canfin, artists Brian Eno and Richard Curtis, UN General Assembly past president Maria Espinosa, and economists such as Gabriel Zucman, Jayati Ghosh, Kate Raworth, Joe Stiglitz, Lucas Chancel and Thomas Piketty.
The massive accumulations of extreme wealth by the richest individuals is “an economic, ecological and human rights disaster” that is “threatening political stability all over the world”, they say.
Denying the “false promise that wealth at the top would somehow benefit us all”, they say that the G20 must act now to unlock a fairer tax regime that will raise the trillions of dollars needed to tackle huge global threats, such as poverty and inequality, wage deflation, and the climate crisis. Getting an international agreement on how to increase taxes on the super-rich “will not be easy, but it will be worth it.”
“Much work has already been done. There is an abundance of policy proposals on wealth taxation from some of the world’s leading economists. The public wants it. We want it. Now all that’s missing is the political will to deliver it. It’s time for you to find it.”
Morris Pearl, Chair of the Patriotic Millionaires and former Managing Director at BlackRock, said: “In recent decades, wealth inequality has skyrocketed around the world. The growing gap between rich and poor has destabilised the global economy, exacerbated the rise of extremist politics, and frayed the very fabric of our social order. As an ultra-wealthy person, representing an organisation of like-minded wealthy people, I am asking the G20 to tax us.
“The leaders of the world’s largest economies must coordinate swift and decisive action to reduce dangerous levels of inequality; if they fail to tax extreme wealth, the results will be a perpetually weakened global economy, the decline of democratic institutions, and worsening social unrest. The G20 must act.”
TAX AND WEALTH FACTS
• In the last decade those with over $50m have enjoyed an 18.3% growth on their wealth, while billionaires have seen their wealth grow by 109%.
• Only 4 cents in every dollar of tax revenue comes from wealth taxes.
• Since 2020, the richest 1% have captured almost two-thirds of all new wealth. Billionaire fortunes are increasing by $2.7bn a day.
• For every dollar of new wealth gained by someone in the bottom 90%, one of the world’s billionaires has gained $1.7m.
• Half of all millionaires will not pay any inheritance tax and will pass on $5 trillion tax-free to the next generation.
• The average tax rate on the richest has fallen from 58% in 1980 to 42% in OECD countries.
• Tax on capital gains – typically the most important source of income for the top 1% – are only 18% on average across more than 100 countries.
• In the boom years of the 1950-60s, the top marginal rate of US federal income tax was 91%, inheritance tax was 77% until 1975 and corporate tax above 50%.
The open letter was organised by inequality campaigners Patriotic Millionaires, the Institute for Policy Studies, Earth4All, Millionaires for Humanity, and Oxfam. The full list of signatories is here.
