A groundbreaking analysis by British organization Oxfam has exposed staggering wealth inequality worldwide. According to their report released today, the world's wealthiest 1% of the global population has amassed an astounding $42 trillion in new wealth over the past decade. This eye-watering figure stands in stark contrast to the entire bottom 50% of the world’s population, whose combined wealth pales in comparison.

The average wealth per person within the top 1% surged by nearly $400,000 in real terms during the last ten years. In contrast, individuals in the bottom half experienced a meager increase of just $335—equivalent to less than nine cents a day. This alarming disparity underscores the urgent need for systemic change.

G20 Finance Ministers Confront the Issue

As G20 Finance Ministers and Central Bank Governors convene in Rio de Janeiro, the spotlight is on a “groundbreaking global deal” aimed at taxing the super-rich. Spearheaded by the Brazilian G20 Presidency and supported by countries like South Africa, Spain, and France, this proposal responds to growing public demand for measures to curb extreme inequality.

World's wealthiest
Image Source: GEO.TV

Max Lawson, Oxfam International's Head of Inequality Policy, claims that global inequality has reached bizarre levels. "...until now governments have failed to protect people and planet from its catastrophic effects. The richest 1% of humanity continues to fill their pockets while the rest are left to scrap for crumbs."

"Momentum to increase taxes on the super-rich is undeniable, and this week is the first real litmus test for G20 governments. Do they have the political will to strike a global standard that puts the needs of the many before the greed of an elite few?” he added.

Oxfam advocates for taxing the wealthiest individuals as a crucial step toward reducing inequality and addressing poverty. Shockingly, less than eight cents of every dollar raised in tax revenue in G20 countries currently comes from taxes on wealth. Meanwhile, the share of income for the top 1% has risen by 45% over four decades, even as top tax rates on their incomes were slashed.

Global Implications

Oxfam’s analysis highlights the potential impact of targeted taxation. A modest tax rate of one to two percent on net wealth above £10 million for British millionaires and billionaires could generate up to £22 billion annually. Aligning wealth income tax rates with those on earned income could add another £16.7 billion to government coffers.

Globally, billionaires pay a paltry tax rate equivalent to less than 0.5% of their wealth. To meaningfully reduce extreme wealth, Oxfam asserts that an annual net wealth tax of at least eight percent is necessary. Notably, G20 countries are home to nearly four out of five of the world’s billionaires.

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