Some millionaires ask world leaders to create a wealth tax. A study estimates it could provide healthcare to 3.6 billion individuals, lift 70% of people below the poverty line and make enough Covid-19 vaccines for the world.
Three organizations of millionaires signed the open letter “In tax we trust” on January 18, addressed to their “fellow millionaires and billionaires”, government and world leaders participating in the virtual World Economic Forum 2022.
The 102 millionaires from nine countries call for a permanent wealth tax to reduce inequality. They consider the current tax system unfair. “The bedrock of a strong democracy is a fair tax system”, nevertheless “few if any of us can honestly say that we pay our fair share in taxes”, they advocate in the letter.
The campaign In tax we trust is powered by three organizations: Patriotic Millionaires, Millionaires For Humanity, and Taxmenow. Most of the signatories come from the United States (59) and the United Kingdom (20).
With 56.1 million millionaires worldwide at the end of 2020 according to Credit Suisse’s Global wealth report 2021, the signatories account for 0,0002% of the millionaire’s population.
A wealth tax on multi-millionaires and billionaires could bring $2.5 trillion every year
In the meantime, Patriotic Millionaires, along with Fight Inequality Alliance, Institute for Policy Studies and Oxfam released a study where a wealth tax on the 3.8 million richest individuals could raise US$2,520 billion every year.
The tax scheme would create a 5% wealth tax on the 2,660 global billionaires, a 3% tax on 183,000 people wealthier than US$50 million and a 2% tax on the 3.6 million individuals with more than $5 million in assets.
Such a wealth tax could raise as much as $2.52 trillion a year according to their calculations.
This amount would be enough to provide universal healthcare and social protection for 3.6 billion people, lift 2.3 billion people out of poverty – 70% of all living below World Bank’s poverty line of $5.50 a day – and make Covid-19 vaccines for the world altogether.
The study used data from Forbes and Wealth X to prepare estimates which they note are only indicative.
The organizations also find it legitimate to use wealth tax to reduce the total number of billionaires and multi-millionaires.
Oxfam released a report this week in which the wealth of the 10 richest men has doubled to $1.5 trillion dollars during the Covid-19 pandemic. Household incomes increased globally in 2020 while the government became more indebted.
Last October, 136 countries agreed to impose a minimum tax of 15% on big companies for them to stop avoiding taxation. In early 2021, the World Bank considered the world as a “fiscal hole” and urged countries to consider a wealth tax.