At the G20 conference in Sao Paulo, Brazil’s finance minister suggests a worldwide tax on the ultra-wealthy

RIO DE JANEIRO: At a G20 summit in Sao Paulo on Thursday, Brazil’s finance minister advised his counterparts that a worldwide tax on the ultra-rich should be implemented by nations in an attempt to combat widespread tax fraud.

According to Fernando Haddad, international collaboration can address tax evasion and allow “these few individuals to make their contribution to our societies and to the planet’s sustainable development.”

He continued by saying that Brazil is pressing for a G20 statement on international taxes, which he anticipated would be completed in July. However, he acknowledged that the road ahead would not be easy at a news conference held after the meeting.

He predicted a great deal of disagreement, saying that it is only normal given that different nations have differing opinions on the issue that Brazil brought up at the G20.

President Luiz Inácio Lula da Silva of Brazil, who now holds the presidency of the 20 largest affluent and developing countries, has prioritized concerns facing the developing world, including the lowering of inequality and the reform of international institutions.

Haddad mentioned social, economic, and environmental challenges when he stated, “Brazil has a role to play, a legitimacy to use on the issues that need to be addressed and that are not always represented in the G20.”

A 2023 analysis by the advocacy organization Tax Justice Network estimates that tax havens might cost nations worldwide up to $4.8 trillion in lost tax income over the course of the following ten years. Furthermore, according to a study released earlier this year by the EU Tax Observatory and referenced by Haddad, billionaires throughout the globe effectively pay taxes that range from 0% to 0.5% of their wealth.

Scandals like the Paradise Papers and the Panama Papers Leak have shown how commonplace tax cheating and avoidance are in corporate operations in recent years.

Meanwhile, Oxfam International, an anti-poverty group, claims that since the coronavirus epidemic, the gap between the super-rich and the majority of the world’s population has widened dramatically.

Compared to two or three decades ago, there are now lower taxes on assets. The worldwide trend has been to lower taxes on wealth and corporations, according to André Vereta-Nahoum, a professor of sociology at the University of Sao Paulo.

However, as inequality rises, more people are demanding more taxes on the affluent. One such person is US President Joe Biden, who has advocated for a minimum income tax on billionaires, even though there is little chance that Congress would approve such a plan.

The United Nations General Assembly backed enhanced international tax cooperation to “make it fully inclusive and more effective” late last year, in a sign of increasing global unanimity on the issue.

The challenge now lies in presenting the problem since the information is readily available. The challenge is coming up with a shared document, according to economist Carla Beni of the university and think tank Getulio Vargas Foundation.