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gabriel zucman
G20 Leaders Reach 'Landmark Commitment' for Global Tax on Ultrarich
"Now is the time to turn words into action and launch an inclusive international negotiation, extending beyond G20 countries, on the reform of the taxation of the superrich," said economist Gabriel Zucman.
Nov 19, 2024
Acknowledging that "the era of the billionaire" is still in full swing across the globe, economic justice advocates on Tuesday applauded a "landmark commitment" by G20 leaders at the group's annual summit in Rio de Janeiro, where delegates agreed to cooperate on efforts to ensure the richest households in the world are taxed fairly.
The final communiqué out of the G20 Summit includes a commitment from 19 countries, the European Union, and the African Union, to "engage cooperatively to ensure that ultra-high-net-worth individuals are effectively taxed."
"Cooperation could involve exchanging best practices, encouraging debates around tax principles, and devising anti-avoidance mechanisms, including addressing potentially harmful tax practices," reads the communiqué. "We look forward to continuing to discuss these issues in the G20 and other relevant forums, counting on the technical inputs of relevant international organizations, academia, and experts."
The final text was brokered by Brazilian President Luiz Inácio Lula da Silva, commonly known as Lula, and the E.U. Tax Observatory noted that Argentina's right-wing president, Javier Milei, "failed to convince other G20 countries to block the communiqué."
The meeting took place less than a year after economist Gabriel Zucman, director of the E.U. Tax Observatory, published a report titledA Blueprint for a Coordinated Minimum Effective Taxation Standard for Ultra-High-Net-Worth Individuals, which informed G20 finance discussions leading up to the summit.
"A minimum tax on billionaires equal to 2% of their wealth would raise $200-$250 billion per year globally from about 3,000 taxpayers; extending the tax to centimillionaires would add $100-$140 billion," said Zucman, a leading expert on tax avoidance and reducing inequality, in the report.
Billionaires' effective tax rate is currently equivalent to 0.3% of their wealth, requiring them to pay a far lower rate than middle-class taxpayers.
Zucman hailed the agreement out of the summit in Rio de Janeiro as a "historic decision" and said concrete action by the world's governments must follow.
"Now is the time to turn words into action and launch an inclusive international negotiation, extending beyond G20 countries, on the reform of the taxation of the superrich," said Zucman.
Along with Milei, the Biden administration pushed back this year as the G20 weighed Zucman's tax proposal. Treasury Secretary Janet Yellen toldThe Wall Street Journal in May that the "notion of some common global arrangement for taxing billionaires with proceeds redistributed in some way—we're not supportive of a process to try to achieve that. That's something we can't sign on to."
As Common Dreamsreported Tuesday, the U.S. is one of eight countries that are contributing to an international loss of $492 billion in taxes each year as multinational corporations and ultrawealthy individuals underpay. The eight countries—which also include Australia, Canada, Israel, Japan, New Zealand, South Korea, and the U.K.—oppose a United Nations tax convention.
Jenny Ricks, general secretary of the Fight Inequality Alliance, said that particularly with U.S. President-elect Donald Trump set to take office in January, "we live in the era of the billionaire."
"We need to move to the era of the 99%," said Ricks. "This shift won't come easily. The U.S. elections have shown how the superrich can use their wealth and power to influence policies and shape the outcomes of elections. Leaders like Trump in the U.S. and Javier Milei in Argentina are actively working to derail international cooperation, while politicians around the world fail to oppose the vested interests that continue to benefit from such unequal societies."
"We will fight harder than ever before to transform the rhetoric on taxing the rich into a global reality," she added. "We need more equal societies in which the richest no longer hold all the power and wealth, with devastating consequences. We need to redistribute the wealth of the superrich to fund vital public services and the response to climate change. Such a transformation is essential to creating the alternative we seek to today's broken system."
Viviana Santiago, executive director of Oxfam Brazil, applauded Lula's government and the G20 leaders for responding "to people's demands worldwide to tackle extreme inequality, hunger, and climate breakdown, and particularly for rallying action on taxing the superrich."
"G20 governments deserve praise for their groundbreaking commitment to cooperate on taxing the world's superrich. But we won't rest until this delivers real change for people and planet," said Santiago, adding that governments now ostensibly supporting a tax on billionaires' wealth should also "be championing a $5 trillion climate finance goal at COP29," the U.N. summit set to wrap up in Baku, Azerbaijan this week.
"How can they argue that climate justice is unaffordable with a deal to raise trillions of dollars by taxing the superrich on the table?" she asked.
Quentin Parrinello, policy director at the E.U. Tax Observatory, asserted that negotiations on the tax proposal "must now extend to a much more inclusive space than the G20."
"Such reforms don't happen overnight, but time is pressing," said Parrinello. "This agenda is even more important today, with the risk of geopolitical fragmentation and looming wealth concentration fueling inequality and undermining democracy."
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NYT Gives 'Whining' Megadonors a Platform to Push Harris Against Taxing the Rich
"I'm shocked, shocked, I tell you that Wall Street billionaires and Silicon Valley tech bros are trying to convince a presidential candidate to abandon her commitment to tax them," said the chair of the Patriotic Millionaires.
Aug 30, 2024
The United States' "paper of record" gave ultra-rich investors and corporate executives a platform on Thursday to sound off against Vice President Kamala Harris' support for a tax on unrealized capital gains, a popular proposal that has stirred howls of complaint from Silicon Valley elites whom Harris used to represent in the Senate.
The New York Timesstory—headlined "Donors Quietly Push Harris to Drop Tax on Ultrawealthy"—quotes billionaire investor Mark Cuban; Aaron Levie, CEO of the cloud storage firm Box; Charles Myers, the founder of Signum Global Advisors; and others who have backed Harris' presidential bid.
"In my interactions with them, the key is she focuses on her values and is not an ideologue about any particular program," Cuban told the Times, which described him as one of the donors close to Harris who doesn't "believe she is that committed" to taxing billionaire wealth.
"From what I've been told," said Cuban, "everything is on the table, nothing's been decided yet."
Levie, who has donated $30,000 to Harris' campaign, said Silicon Valley leaders he has spoken with about the proposed tax on unrealized capital gains see the idea as "quite punitive."
"There's optimism that this can't possibly be real," said Levie. "Most people are waiting to hear from the Harris campaign. Is this a real proposal that is actually being pushed for—or was this something that was inherited from Biden?"
"The only thing at stake here is the remarkably fragile egos of billionaires who are on the verge of realizing they might not be saving civilization for anyone, including themselves."
The Times noted Friday that a group of wealthy Harris supporters known as "VCs for Kamala" found in a survey of its members that "roughly 75% of respondents agreed with the statement 'taxing unrealized capital gains will stifle innovation.'" The group includes billionaire LinkedIn founder Reid Hoffman and billionaire investor Chris Sacca.
The Patriotic Millionaires, a group of rich Americans who support higher taxes on the wealthy, issued a statement Friday criticizing both the "whining" megadonors and the Times for handing them a megaphone to attack efforts to rein in billionaire tax dodging.
"I'm shocked, shocked, I tell you that Wall Street billionaires and Silicon Valley tech bros are trying to convince a presidential candidate to abandon her commitment to tax them, and using their own alleged brilliance to justify it," said Morris Pearl, the chair of the Patriotic Millionaires. "I admire their chutzpah in claiming that taxing unrealized capital gains will stifle innovation!"
"Claiming that making a billionaire pay taxes on their second billion will reduce innovation is as absurd as the rooster claiming the sun won't rise without his crowing," Pearl added. "The billionaires I know were all highly motivated to earn their first billion. The only thing at stake here is the remarkably fragile egos of billionaires who are on the verge of realizing they might not be saving civilization for anyone, including themselves."
The Patriotic Millionaires also suggested some adjustments to the Times headline:
Some (Silly/Misinformed) Donors Quietly (although not actually all that quietly; it was reported on the front page of the NYT after all) Push Harris to Drop (Modest Compared to What it Should Be) Tax on Ultra-Wealthy While Other (Much More Sensible and, yes, More Patriotic) Donors Loudly Push Billionaires to Drop Opposition to Common Sense.
The Harris campaign has voiced support for the tax proposals outlined in President Joe Biden's most recent budget blueprint, including a tax on the unrealized capital gains accumulated by individuals with net worths exceeding $100 million—a portion of the nation's upper class that contains fewer than 11,000 people.
Under the nation's current tax structure, billionaires are able to dodge taxes by never or rarely selling stock positions, which are not taxed until they are "realized."
Gabriel Zucman, an economics professor at the University of California, Berkeley and a leading advocate of a tax on billionaire wealth, has applauded the Harris campaign for embracing the proposed levy on the unrealized capital gains of the ultra-wealthy.
In a May op-ed in the Times, Zucman noted that U.S. billionaires paid a lower effective tax rate than working-class Americans for the first time in the nation's history in 2018.
"The idea that billionaires should pay a minimum amount of income tax is not a radical idea," Zucman wrote at the time. "What is radical is continuing to allow the wealthiest people in the world to pay a smaller percentage in income tax than nearly everybody else."
"In liberal democracies, a wave of political sentiment is building, focused on rooting out the inequality that corrodes societies," the economist added. "A coordinated minimum tax on the superrich will not fix capitalism. But it is a necessary first step."
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'Let's Go!' Top Economist Applauds as Harris Signals Support for Billionaires Tax
Gabriel Zucman, a leading authority on tax evasion by the rich, welcomed news that Kamala Harris' presidential campaign is embracing proposals to tax the ultra-wealthy and large corporations.
Aug 20, 2024
An economist at the forefront of the growing global push for a billionaire wealth tax is welcoming news that U.S. Democratic presidential nominee Kamala Harris is embracing calls for a minimum levy on the United States' richest individuals.
"Let's go!" Gabriel Zucman, an economics professor at the University of California, Berkeley, wrote Tuesday in response to Semaforreporting on the Harris team's endorsement of taxes on ultra-wealthy individuals and large corporations proposed in President Joe Biden's budget for Fiscal Year 2025.
Semafor highlighted a "little-noticed portion" of an analysis released late last week by the Committee for a Responsible Federal Budget, which wrote that Harris' campaign "specifically told us that they support all of the tax increases on the high earners and corporations that are in the Biden budget."
That budget blueprint includes a 25% minimum tax on billionaire wealth, much of which is unrealized capital gains that are not currently subject to taxation. A recent analysis by Americans for Tax Fairness estimated that U.S. billionaires and centi-millionaires collectively held at least $8.5 trillion in unrealized capital gains in 2022—a massive untapped source of federal revenue.
U.S. billionaires have seen their collective fortunes grow by more than $2 trillion since former President Donald Trump—the GOP's 2024 nominee—signed into law massive tax breaks for the rich and big corporations. Trump has campaigned on extending the deeply regressive and unpopular tax cuts and slashing rates for large companies even further.
Surging billionaire wealth at a time when roughly two-thirds of Americans are living paycheck-to-paycheck has amplified calls for a minimum tax on the richest Americans. Zucman noted in a May New York Times piece that in 2018, U.S. billionaires paid a lower effective tax rate than working-class Americans for the first time in the nation's history.
"The idea that billionaires should pay a minimum amount of income tax is not a radical idea," Zucman wrote in May. "What is radical is continuing to allow the wealthiest people in the world to pay a smaller percentage in income tax than nearly everybody else."
Polling has shown that a 25% tax on billionaire wealth is extremely popular with U.S. voters across the political spectrum. A survey in March of last year by Data for Progress found that 87% of Democrats, 68% of Independents and third-party voters, and 51% of Republicans back the idea.
A spokesperson for the Harris campaign confirmed to NBC News on Monday that in addition to backing the push for a minimum tax on billionaires, the vice president supports raising the corporate tax rate from 21% to 28% as a way to help finance parts of her broader economic agenda, which includes an expanded child tax credit and substantial assistance for first-time homebuyers.
The campaign spokesperson called the move—which would still leave the corporate tax rate lower than it was when Trump first took office in 2017—a "fiscally responsible way to put money back in the pockets of working people and ensure billionaires and big corporations pay their fair share."
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