The group is suggesting a coordinated international push to tax billionaires.
As governments of the world continue to tackle tax evasion, a new study has hinted at what might be their next line of action. This follows after an EU Tax Observatory group said that a global minimum tax on billionaires could help raise $250 billion annually, per a report from ChannelNewsAsia.
The research group asserts that if the so-called minimum tax is levied, only about 2% of the combined wealth ($13 trillion) of the world’s billionaires would have been taxed.
Group Says Billionaire Tax Must Be Reviewed
In its 2024 Global Tax Evasion Report, the group cites how billionaires currently pay far less tax than people of even more modest means. According to the group director Gabriel Zucman, this situation presents two major issues. He said in a statement:
“In our view, this is difficult to justify because it risks undermining the sustainability of tax systems and the social acceptability of taxation.”
The Observatory estimates that the personal tax of billionaires in the United States, for instance, is at around 0.5 percent. Whereas, in other places such as high-tax France, billionaires may not even pay a dime in tax.
To this end, the group is suggesting a coordinated international push to tax billionaires. Although it admits that that may take years, the Observatory believes that it is achievable.
It recalls how many thought the government couldn’t end bank secrecy or stop multinationals from shifting profits to low-tax countries. However, an automatic sharing of account information, which was launched against secrecy in 2018, has recorded huge success, the group observed. Similarly, a global 15 percent floor tag has now been placed on corporate taxation to stop multinationals from boycotting tax. However, that will only take effect next year.
Zucman concludes that the same logic that was applied to multinational companies may now be extended to billionaires. However, he also admitted that all hands must be on deck for the minimum tax on billionaires to take effect. In the absence of this concerted effort, Zucman says a “coalition of willing countries” might start the movement.
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