Report proposes implementation of minimum tax rate for billionaires

A report from the EU Tax Observatory has suggested that billionaires should face a minimum tax rate, as many of the world's super-rich are found to be paying very little or no tax. The report highlights that these individuals often use complex business structures to avoid paying their fair share, while the average person pays a higher tax rate. The proposed solution is a minimum 2% tax rate on billionaires' global wealth, which could generate $250 billion annually. Currently, there are about 2,500 billionaires worldwide with a combined wealth of $13 trillion. The report also acknowledges that efforts to combat offshore tax evasion have been successful due to the automatic sharing of wealthy individuals' account information across more than 100 countries. However, it emphasizes that billionaires can still exploit loopholes, such as using shell companies, to pay minimal tax rates. The agreement reached in 2021 by 140 countries to ensure a 15% global corporation tax rate is praised in the report, but it warns that the plan has been weakened by the emergence of various loopholes. Renowned economist Joseph Stiglitz, who contributed to the report, believes that tax unfairness poses a risk to democracy. He argues that when citizens witness the wealthy and corporations evading their tax obligations, they become distrustful and may reject taxation. Stiglitz emphasizes that addressing tax fairness and revenue collection is critical for society's challenges, including climate change, pandemics, and inequality, as well as for essential investments in education, health, infrastructure, and technology. Despite some billionaires pledging to give away the majority of their wealth, the report stresses the urgency of achieving tax fairness and revenue collection for the greater benefit of society.