Governments should open a new front in the international fight against tax evasion with a tax world minimum at billionaires, that could raise $250 billion annually, the Fiscal Observatory of the European Union.
If collected, The sum would be equivalent to only 2% of the almost 13 trillion dollars of wealth owned by the 2,700 billionaires around the world, said the research group, which is based at the Paris School of Economics.
Today, billionaires’ effective personal taxes are often much lower than those paid by other taxpayers of more modest means, as they use shell companies that shield them from income taxes, the group said in its Global Tax Evasion Report 2024.
The personal tax on billionaires in the United States is estimated to be close to 0.5% and as low as zero in otherwise high-tax France, the Observatory said.
That the rich bear a greater tax burden
Rising wealth inequality in some countries is fueling calls for the richest citizens to bear a greater tax burden, as public finances struggle to cope with an aging population.
US President Joe Biden’s 2024 budget included plans for a 25% minimum tax on the richest 0.01%, but that proposal fell in the chamber of lawmakers in Washington.
The Observatory pointed out as a success of the Governments the almost ending of banking secrecy and reducing the opportunities for multinationals to transfer profits to low-tax countries.
The launch in 2018 of the automatic exchange of account information has reduced the amount of wealth deposited in tax havens three times, according to the Observatory’s estimates.
In the absence of broad international momentum for a minimum tax on billionaires, Gabriel Zucman, director of the Observatory said that “a coalition of willing countries could unilaterally lead the way.”
Source: Ambito
