Brazil’s Finance Minister Calls For Taxing Super-Rich Globally

By Daniel Mello 

On Wednesday (Feb. 28), Brazil’s Finance Minister Fernando Haddad proposed that countries worldwide join forces to tax large fortunes. He stated, “We need to ensure that the world’s billionaires contribute their fair share in taxes. In addition to supporting ongoing negotiations at the OECD [Organization for Economic Cooperation and Development] and the UN [United Nations], we believe that implementing a global minimum wealth tax could serve as a third pillar of international tax cooperation.”

Haddad opened the 1st Meeting of Finance Ministers and Central Bank Presidents of the G20 Finance Track. Although scheduled to preside over the session, he delivered his speech via video transmission due to his recent COVID-19 diagnosis.

Inequality

Haddad highlighted addressing inequality and climate change as the primary challenges to be collectively addressed by the countries comprising the G20, the world’s 20 largest economies. “We need to understand climate change and poverty as truly global challenges, to be tackled through a new socio-environmental globalization,” he emphasized.

The minister stated that social inequality must be the focal point of economic analysis and planning. “We believe that inequality should not be viewed solely as a social issue, a mere corollary of economic policy. Our policy is to focus on inequality as a fundamental variable for economic policy analysis. We aim to develop the most appropriate analytical tools for this purpose,” he added.

The gulf that separates the super-rich from the poorest populations is also related, according to the minister, to the climate issue. “We have reached an unsustainable situation in which the richest 1 percent own 43 percent of the world’s financial assets and emit the same amount of carbon as the poorest two-thirds of humanity,” he stated.

In this context, Haddad observes that the least economically developed countries suffer the most from the damage caused by global climate change. “The climate crisis has escalated into a genuine emergency. Poorer nations must bear increasing environmental and economic costs while seeing their exports threatened by a growing wave of protectionism,” he remarked.

The minister called for a new understanding of globalization and international cooperation, different from what has occurred in previous decades and has been rejected by various populations around the world. “The current reaction to globalization can be attributed to the specific type of globalization that prevailed until the 2008 financial crisis. Prior to that, global economic integration was confused with the liberalization of markets, the relaxation of labor laws, financial deregulation, and the free movement of capital. The resulting financial crises caused major socio-economic losses,” explained Haddad