International poverty charity Oxfam has called for a systemic and wide-ranging increase in taxation of the super-rich, echoing recent calls from billionaire Microsoft co-founder Bill Gates.
Research published by Oxfam on Monday found that billionaires fortunes were increasing by an average of $2.7 billion every day. Meanwhile, 1.7 billion workers now live in countries where inflation is outpacing wage growth, the charity said.
Oxfam said imposing a tax of up to 5% on multimillionaires and billionaires could raise $1.7 trillion annuallyenough to lift 2 billion people out of poverty.
The publication of Oxfams Survival of the Richest report coincides with the beginning of the World Economic Forums annual event in Davos, Switzerland, which will see wealthy and powerful individuals from around the globe gather at an exclusive ski resort.
Recent big gains
According to its findings, the worlds wealthiest 1% of people have captured two-thirds of all new worth created since 2020amounting to $42 trillion. Thats twice as much as the wealth captured by the bottom 99% of the global population over the same period.
Over the past decade, Oxfam said, the richest 1% have captured around half of all new wealth.
America is still in the lead when it comes to housing billionaires, with 735 people living in the U.S. having billionaire status, according to Forbes.
Since 2020, a billionaire would have gained around $1.7 million for every $1 of new global wealth earned by a person in the poorest 90% of the worlds population, the charity added, describing those with billionaire status as experiencing extraordinary increases in their wealth.
This comes on top of a decade of historic gainsthe number and wealth of billionaires having doubled over the last ten years, Oxfam said in a news release on Monday.
The organization went on to name and shame companies and individuals who it said had helped drive spiraling inflation with excess corporate profits that boosted their net worth. They included companies in the food and energy sectorsspecifically Indian energy mogul Gautam Adani and the Walton family, who own Walmart. Adani, Oxfam noted, saw his wealth soar by $42 billion in 2022.
Last year, college dropout Adani became the first Asian person to break into the top three of the Bloomberg Billionaires Index. As of Jan. 16, he was the fourth richest person in the world, according to the ranking.
Three members of the Walton dynasty account for the 17th, 18th and 19th places in Bloombergs list of the worlds richest people.
Spokespeople for Adani and the Waltons were not immediately available for comment when contacted by Fortune.
Oxfam on Monday urged policymakers to implement a systemic and wide-ranging increase in taxation of the super-rich to claw back crisis gains driven by public money and profiteering.
Decades of tax cuts for the richest and corporations have fueled inequality, with the poorest people in many countries paying higher tax rates than billionaires, the organization argued.
According to its report, taxation on the wealthiest used to be much higher, but currently only four cents in every tax dollar comes from taxes on wealth. Half of the worlds billionaires live in countries with no inheritance tax for direct descendants, the report said, slamming wealthy individuals income as mostly unearned, derived from returns on their assets.
Yet it is taxed on average at 18 percent, just over half as much as the average top tax rate on wages and salaries, Oxfam said. Over the last forty years, governments across Africa, Asia, Europe, and the Americas have slashed the income tax rates on the richest. At the same time, they have upped taxes on goods and services, which fall disproportionately on the poorest people and exacerbate gender inequality.
The charity called on governments to introduce one-off wealth taxes and windfall taxes to end crisis profiteering, permanently increase taxes on the richest 1% to at least 60% of their income from labor and capital, and tax the wealth of the richest 1% at rates high enough to significantly reduce the numbers and wealth of the richest people, and redistribute these resources.
The latter proposal included raising funds through inheritance, property and land taxes, as well as net wealth taxes.
Taxing the super-rich and big corporations is the door out of todays overlapping crises, Gabriela Bucher, executive director of Oxfam International, said in the organizations press release on Monday. Its time we demolish the convenient myth that tax cuts for the richest result in their wealth somehow trickling down to everyone else. Forty years of tax cuts for the super-rich have shown that a rising tide doesnt lift all shipsjust the superyachts.
Support from Bill Gates
Oxfams call for governments to redistribute wealth echoes suggestions made by Bill Gates, who said he supported the idea of rich people paying more in taxes during a Reddit Q&A last week.
I am surprised taxes have not been increased more, he said. For example, capital gains rates could be the same as ordinary income rates. I know things are tough for a lot of people.
He added that it was common for those at the top to lose sight of what life is like for the majority of people, arguing that being rich can easily make you out of touch.
Last year, Gates announced that he planned to give virtually all of his wealth to his foundation, which is working to address various societal issues like climate change and making healthcare accessible.
The Microsoft cofounder isnt the only high-profile billionaire to call for more taxes to be levied on societys wealthiest.
Disney heiress Abigail Disney, Salesforce cofounder Marc Benioff and legendary investor Ray Dalio are among of a growing number of ultrawealthy people who have publicly expressed support for tax hikes on the rich.
However, there are some high-net-worth players who arent on board with handing more of their cash over to the tax man.
Elon Musk has been a vocal opponent to levying more tax responsibilities on the worlds wealthiest. In 2021, he slammed proposals for a so-called billionaire tax, saying having to pay more taxes would disrupt his plans to get humanity to Mars. Musk, the worlds second-richest person, has a net worth of $132 billion, according to Bloomberg.
Back in 2019, Home depot co-founder Bernard Marcus and supermarket mogul John Catsimatidis, argued in an op-ed for the Wall Street Journal that every additional dollar the government takes from us is a dollar less for this critical process of expanding Americas wealth and job-creating businesses.
