Australia’s wealthiest 1% are 61% richer than they were before the pandemic and have pocketed $150,000 a minute over the past decade, according to new analysis by Oxfam Australia.
The analysis was released on Monday to coincide with Oxfam’s global report on wealth disparity, Survival of the Richest, and the launch of this year’s World Economic Forum in Davos, Switzerland.
The Australian data showed that a wealth tax of just 2% on the country’s millionaires with wealth over $7m, 3% on those with wealth over $67m, and 5% on billionaires would raise $29.1bn annually, enough to increase income support payments to the Henderson poverty line of $88 a day for 1.44 million people.
By contrast, the federal government is pressing ahead with the Morrison-era stage three tax cuts, which will result in $243bn of lost tax revenue in the decade after they come into effect.
Oxfam is calling for the tax cuts to be scrapped and replaced by a “systemic and wide-ranging increase in taxation of the super-rich”, which would include a personal wealth tax and a windfall tax on corporations.
Oxfam Australia’s director of programs, Anthea Spinks, said the government needed to “address the broken system that perpetuates inequality and poverty in Australia and beyond”.
As of March 2021, 1.3 million Australians were receiving a jobseeker or youth allowance payment, worth $47.74 and $37.89 a day respectively.
Yet just 42 individual Australians had a combined wealth of nearly $236bn, Spinks said.
“The reckless thing to do would be to maintain the status quo. The most sensible and effective thing to do to reign in extreme inequality is to tax the super-rich,” she said.
Data from Credit Suisse analysed in the global report showed that the richest 1% of people in the world claimed about 63% of all wealth created between 2020 and 2021. The bottom 90% of the global population shared in only 10% of that new wealth.
Following Australia Institute analysis released in July, the report argued that corporate profiteering was driving at least 50% of inflation in Australia, as well as in the US and Europe.
Dramatically higher taxes on the ultra-rich were necessary to address global inequality and raise revenue to fund the “green transition”, the report said. Oxfam suggests an appropriate tax rate on the richest 1% would be at least 60% of income and capital.
Taxing the super-rich was “the path out of today’s overlapping inequality and climate crises”, Spinks said.
“A wealth tax alone would raise just over $29bn a year. This would be enough to dramatically reduce poverty in Australia and overseas by lifting the aid budget, raising income support payments, building desperately needed social housing, and investing in grants to get homes off gas, which would reduce bills for the poorest Australians.”
