Brazil He believes he has found a way to pay for the fight against climate change and hunger in the world: tax the super rich.
As president of Group of 20 This year, Brazil has focused its efforts on the implementation of a global minimum tax on heritage of the billionaires. This will serve to finance the fight against rising temperatures and poverty in low- and middle-income countries, and seeks support for the idea – already popular in progressive circles – on the world stage.
“These resources can be used to initiate decarbonization in the poorest countries, which would increase humanitarian investments in these places,” Brazilian Finance Minister Fernando Haddad said Thursday in an interview in Washington, on the sidelines of the spring meetings of the International Monetary Fund and the world Bank.
Scientists have warned of the risks involved in increase in temperatures in the worldand the president of brazil, Luiz Inácio Lula da Silvahas made climate change and inequality central themes of Brazil’s leadership in the G20.
Brazil urges the G-20 to create a global wealth tax
In February, Brazil invited French economist Gabriel Zucman to make a presentation to G20 finance ministers on its plan to impose a two percent minimum tax on billionaires in the world, a group made up of about 3 thousand people. The suggestion has been well received.
France and Spain have backed the idea of designing a tax and on Wednesday, IMF chief Kristalina Georgieva said that “close tax loopholes and ensure everyone pays their fair share” can help gather more resources for inclusive growth.
Now Brazil is trying to reach a consensus among other G20 members to analyze a tax on the ultra-rich and finalize a proposal over the next three years. Haddad says he hopes to have a policy statement from the group by July, when finance ministers meet in Rio de Janeiro.
The EU Tax Observatory, a Paris-based think tank led by Zucman, estimates that the tax could raise about 250 billion dollars a year Worldwide. Haddad suggested the proceeds could go into a development fund to cover the huge costs for poorer nations to green their economies.
“How can these countries be expected to invest in decarbonization?” she said. “It is a very precarious situation.”
The tax on multinationals is already a reality
Polls show that redistributing money from the world’s richest would be a popular measure in the United States and Europe. However, “tax the rich” it has often functioned more as slogan than hard policy.
To help sell the idea, Brazil has turned to Nobel Prize-winning economists such as Esther Duflo and Joseph Stiglitz.
Haddad acknowledged that his proposal will not be easy to present, but there are reasons to be optimistic. In January, the minimum tax on multinational corporations implemented by the Organization for Economic Cooperation and Development came into force.
“It all started with disbelief and skepticism,” Haddad said. But the idea begins to “gain momentum until it becomes something that is not only feasible, but something that countries feel pressure to adhere to.”
