While one in four people globally face hunger, the level of billionaire wealth is higher than any time in history. Just 12 of the world’s richest billionaires have more wealth than the poorest half of humanity, or more than four billion people. Such concentration of wealth risks undermining democracy , deepen the climate crisis , and halt the realization of basic of rights and dignities for the majority. Wealth inequality reflects an economic system that is stacked in favour of the rich. The richest 1% captured 41% of all new wealth created globally between 2000 and 2024, while the bottom half of humanity captured just 1%. The problem is exacerbated by our current tax systems in which the super-rich typically are paying a lower effective tax rate than ordinary workers. To correct this, a recurrent net wealth tax is needed. Oxfam recommends a net wealth tax that applies to the wealthiest 1% and above, with a robust base and progressive rates for the super-rich. Net wealth taxes were used in 12 OECD countries in the early 1990s but have been removed in all but four today. There has however been a resurgence in interest, and Spain , Bolivia , Tunisia , Colombia and Argentina have all introduced a net wealth tax in recent years. A wealth tax is a significant solution to three challenges: First, it helps raise billions needed to invest in people and planet. Oxfam has calculated that a progressive net wealth tax on the world’s dollar millionaires and billionaires could generate US$1.8 trillion dollars each year. The wealth gained by the world’s billionaires over the past year could fund $250 for every person on the planet while still leaving billionaires $500 billion richer. Second, it helps make our tax systems fairer by ensuring that the rich do not pay lower tax rates than everyone else. Third, it can help reverse wealth inequality, The IMF has estimated that an annual net wealth tax of just 1% can reduce the wealth share in the hands of the richest 1% by 10% over a 20-year period. This can help safeguard democracy against the oligarchic tendencies seen in an increasing number of countries. And it can help limit the outsized emissions that the richest are responsible for.
