Finance ministers from leading rich and developing nations convened in Rio de Janeiro for a two-day meeting to deliberate on a proposed global tax targeting the super-rich. The proposal suggests that individuals with over $1 billion in total assets would be required to pay 2% of their wealth in income tax.
Several countries, including France, Spain, and South Africa, have expressed support for the initiative. However, the U.S. Treasury Secretary reiterated the U.S.'s lack of support, citing challenges in coordinating global tax policies.
Brazil, as the current G20 president, is pushing for an agreement on international tax cooperation that includes the global tax on billionaires. Economists argue that such a tax is essential to reduce the appeal of tax havens and increase revenue for public services and climate change initiatives.
A recent report revealed that billionaires currently pay only 0.3% of their wealth in taxes, highlighting the significant disparity in tax contributions between the super-rich and the working class. The proposed 2% tax could generate $200-250 billion annually from around 3,000 individuals.
The meeting also addressed the growing wealth inequality, with the richest 1% amassing $42 trillion in new wealth over the past decade, far surpassing the combined wealth of the bottom 50% of the global population.
Brazil's President emphasized the need for increased taxation of the super-rich to combat inequality and poverty. He unveiled plans for a global alliance against hunger and poverty, aiming to mobilize funds and knowledge to support policies that address these pressing issues.
The alliance, set to be managed by a secretariat at the U.N. Food and Agriculture Organization headquarters, will focus on combating inequality and poverty until 2030, with Brazil covering half of its costs.
