A global minimum tax on billionaires, equal to 2% of their wealth, could raise nearly $250 billion a year, according to a think tank co-funded by the European Union.
The EU Tax Observatory proposed such a tax in a report released Sunday and said it would affect fewer than 3,000 billionaires. Billionaires have effective tax rates equivalent to zero to 0.5% of their wealth because they use shell companies to dodge income taxation, said the think tank, which is located at the Paris School of Economics.
“To date no serious attempt has been made to address this situation,” it said.Joseph Stiglitz, a Nobel Prize-winning economist, wrote in the report that citizens would begin to reject taxation if they didn’t believe everyone was paying their fair share of taxes. A global minimum tax on the very rich “may seem impossible to attain, but so was undermining bank secrecy and introducing a minimum tax on corporations just a few years ago,” he said. Around 140 jurisdictions agreed to implement the corporate minimum tax in 2021, but the rollout has been slow.
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