11/08/21

INTERNATIONAL TAX: One-off emergency tax on billionaires’ pandemic windfalls could fund Covid-19 jabs for all and cash grant to all unemployed workers, according to new analysis.

As published on reliefweb.int, Wednesday 11 August, 2021.

A one-off 99 per cent levy on billionaires’ wealth gains during the pandemic could pay for everyone on the planet to be vaccinated against Covid-19 and provide a £14,000 ($20,000) cash grant to all unemployed workers, according to new analysis released today by Oxfam, the Fight Inequality Alliance, the Institute for Policy Studies and the Patriotic Millionaires. The organizations are calling on governments to tax the ultra wealthy who profited from the pandemic crisis to help offset its costs.

The one-time emergency Covid-19 billionaire tax would raise £4 trillion ($5.4 trillion) and still leave the world’s 2,690 billionaires £40 billion ($55 billion) richer than before the virus struck. Governments across the world are massively under-taxing the wealthiest individuals and big corporations, which is undermining the fight against CovidD-19 and poverty and inequality.

The world’s billionaires have a collective net worth of £9.7 trillion ($13.5 trillion) - up from £6 trillion ($8 trillion) at the beginning of the pandemic, a gain of nearly 69 per cent. Amazon’s Jeff Bezos’ wealth increased by £57.3 billion ($79.4 billion) during the pandemic, rising from £81.5 billion ($113 billion) in March 2020 to £139 billion ($192 billion). Billionaire wealth has increased more over the past 17 months than it has in the past 15 years, and 325 new billionaires joined the Forbes Billionaire Club since the pandemic began - equivalent to roughly one new billionaire minted every day.

Gary Stevenson, inequality economist, former trader and member of Patriotic Millionaires UK said: “The super-rich have made enormous fortunes during this crisis, just like in 2008. We know what will happen if we do nothing about this, in the UK we are already seeing huge increases in inequality and huge rises in house prices while wages stay in a slump. It’s time for the very wealthiest to pay their fair share to help society recover from this global crisis. Philanthropy isn’t the answer, it can’t be optional. A wealth tax is the solution.”

Less than one per cent of people in low-income countries have received a vaccine, while the profits made by Big Pharma has seen the CEOs of Moderna and BioNTech become billionaires. The Covid-19 crisis has pushed over 200 million people into poverty and cost women around the world at least £600 billion in lost income in 2020, ($800 billion) equivalent to more than the combined GDP of 98 countries. At the same time, 11 people are now likely dying of hunger and malnutrition each minute, outpacing Covid-19 fatalities.

Governments have in the past turned to the wealthiest in response to major crises. After World Wars I and II, one-off wealth taxes were levied in European countries and Japan to fund reconstruction. France, for example, taxed excessive wartime wealth gains at a rate of 100 per cent after the Second World War. More recently, following the global financial crisis of 2008, countries including Iceland introduced temporary wealth taxes to help refill public coffers.

Policymakers, leading economists, civil society organizations, the UN, IMF and the World Bank are calling for one-time ‘solidarity taxes’ and longer-term wealth taxes targeted at the super-rich to mitigate the economic impacts of the pandemic and reduce inequalities. In December 2020, debt-saddled Argentina adopted a one-off special levy dubbed the ‘millionaire’s tax’ that has brought in around £1.7 billion ($2.4 billion) to pay for pandemic recovery.

Max Lawson, Oxfam International’s Global Inequality Policy Lead, said: “Billionaire Jeff Bezos could personally pay for enough vaccines for the whole world, yet he would rather spend his wealth on a thrill ride to space. Covid-19 is turning the gap between rich and poor into an unbridgeable chasm. The obscene levels of wealth gained from the pandemic by a handful of mega rich individuals should immediately be taxed at 99 per cent ―enough to fully vaccinate everyone on Earth and help millions of workers who lost their jobs due to Covid-19. Only with this kind of radical and progressive policy making will we be able to fight inequality and end poverty.”

Njoki Njehu, Pan Africa Coordinator of the Fight Inequality Alliance, said: “With a 99 per cent tax on billionaires’ Covid-19 wealth gains, we are calling time on this age of greed. Billionaire wealth is not earned. Billionaires are profiting from working people’s hard graft and pain. It’s their money ’earned’ by your sweat - and it’s high time that sweat began to pay off. Governments need to tax the rich for us to stand any chance of reversing the inequality crisis we’re in.”