Environment Wealth Tax

To recover from the crisis, tax the wealth of multimillionaires like me

To recover from the crisis, tax the wealth of multimillionaires like me

Originally written for the OECD Development Matters

As the world reels from the COVID-19 crisis, countries desperately need to finance health for all, the economic recovery, and poverty reduction. And as the world grapples with the social tensions generated by rising inequality, countries desperately need to find a way to rebuild social cohesion. The great news for 2022 is that there is a way: tax the wealth of multimillionaires to help fund the achievement of the Sustainable Development Goals (SDGs).

I know – because I am one of the multimillionaires who would have to pay a wealth tax.

The OECD’s powerful new report showed that more than 6 out of 10 citizens in OECD countries want their government to tackle the income gap between rich and poor through taxes and wealth transfers. This kind of pressure from citizens has the power to drive redistributive action by governments.

Standing in the way of action on fair taxation, however, are outdated yet enduring myths that many politicians still uphold about how economies work; for instance the idea that it is only by helping the rich that we can help the economy. It is to counter these myths that hundreds of multimillionaires came together as Millionaires for Humanity, to advocate for wealth taxes on ourselves and people like us. We have seen that when we speak out, calling for wealth taxes, the media listens and politicians listen. This gives us a special responsibility, not to direct but to speak out in solidarity with the growing movement asking for a wealth tax. And that is why we feel obliged to add our voice to say this: a wealth tax would be absolutely fair, would not harm business operations, and would not lead to exodus. In fact, a wealth tax, by helping to tackle the gravest social crises, would strengthen stability, broaden prosperity and benefit everyone.

Multimillionaires can easily afford a wealth tax. The wealth of our group has risen during the crisis. And because the returns on capital exceed the level at which wealth taxes are set, wealth taxes do not even make the rich less rich, they only reduce the pace at which we gain wealth.

A wealth tax will bring the kind of funding needed to tackle the world’s major challenges. The UN has calculated that USD 2-3 trillion in additional investment is needed to achieve the SDGs. The figures in the latest Credit Suisse wealth report show that a 1% wealth tax on millionaires would raise approximately USD 2 trillion. In contrast, the OECD has calculated private philanthropy for development at just USD 24 billion.

Countries can implement a wealth tax. Norway and Switzerland are amongst the countries that have had wealth taxes in place for a long time now, while Argentina and Bolivia successfully introduced them last year. Experts like Gabriel Zucman of the University of California, Berkeley, have set out in detail how wealth taxes can be instituted and administered.

Whilst wealth taxes need to be passed and implemented nationally, international co-operation can further strengthen their effectiveness. Pooled financing mechanisms such as the Global Fund to Fight AIDS, TB, and Malaria, and the Global Alliance on Vaccines and Immunizations, have already demonstrated how to manage such resources effectively. A Resolution at the United Nations could help establish a new norm that wealth should be taxed and facilitate collaboration to support the implementation of wealth taxes. Most excitingly, the international agreement last year on a minimum corporate tax rate of 15% has set a valuable precedent: a set of countries could build on that achievement by agreeing on a minimum wealth tax of 1% on any multimillionaire.

We will only emerge from this crisis into a period of sustainable development and shared prosperity if we are courageous enough to put justice at the heart of policy. And if we generate the resources needed to finance the public goods essential to a broad-based and inclusive recovery. A wealth tax on multimillionaires is one important way to help us get there. That is why we, a growing band of multimillionaires, are joining the movement calling for a wealth tax.

The time is now. Tax us.

Our partners & collaborators

The Momentum Institute challenges the social and economic status quo by contextualising and disseminating scientific work. Developing proposals for a more sustainable and inclusive society since 2019.

Taxmenow focuses on initiating changes in the tax system. To do this, members use their privileged access to the media to highlight the damaging effects of wealth inequality.

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Millionaires for Humanity is a collective network of HNWI’s, using their voices to promote wealth taxes across the globe. Advocating for a 1% wealth tax on multimillionaires to achieve the SDG’s.

Patriotic Millionaires seek to combat the destabilizing level of economic and political inequality in America. Patriotic Millionaires members include investors and business owners from across the country.

Religions for Peace has been a movement changing the world and challenging the status quo through the mutual conviction that religions are more powerful, inspiring, and impactful together.

ActionAid Denmark is a movement that fights for a more just and sustainable world. Supporting youths in developing their voice and applying pressure on those in power.

Oxfam is a global movement of people who are fighting inequality to end poverty and injustice. Working across regions in about 70 countries, with thousands of partners, supporting communities to build better lives.

UNICEF works in over 190 countries and territories to save children’s lives, to defend their rights, and to help them fulfil their potential, from early childhood through adolescence.