Sun, January 15, 2023
LONDON (AP) —
Food companies making big profits as inflation has surged should face windfall taxes to help cut global inequality, anti-poverty group Oxfam said Monday as the World Economic Forum's annual meeting gets underway.
That's one of the ideas in a report by Oxfam International, which has sought for a decade to highlight inequality at the conclave of political and business elites in the Swiss ski resort of Davos.
The report, which aims to provoke discussions on panels featuring corporate and government leaders this week, said the world has been beset with simultaneous crises, including climate change, the surging cost of living, Russia’s war in Ukraine and the COVID-19 pandemic, yet the world’s richest have gotten richer and corporate profits are surging.
Over the past two years, the world’s super-rich 1% have gained nearly twice as much wealth as the remaining 99% combined, Oxfam said. Meanwhile, at least 1.7 billion workers live in countries where inflation is outpacing their wage growth, even as billionaire fortunes are rising by $2.7 billion a day.
To combat these problems, Oxfam urged higher taxes on the rich, through a combination of measures including one-time “solidarity” taxes and raising minimum rates for the wealthiest. The group noted that billionaire Tesla CEO Elon Musk's true tax rate from 2014 to 2018 was just over 3%.
Some governments have turned to taxing fossil fuel companies' windfall profits as Russia's war in Ukraine sent oil and natural gas prices soaring last year, squeezing household finances around the world.
Oxfam wants the idea to go further to include big food corporations, as a way to narrow the widening gap between the rich and poor.
“The number of billionaires is growing, and they’re getting richer, and also very large food and energy companies are making excessive profits,” said Gabriela Bucher, Oxfam International's executive director.
“What we’re calling for is windfall taxes, not only on energy companies but also on food companies to end this crisis profiteering," Bucher told The Associated Press in an interview.
Oxfam's report said wealthy corporations are using the war as an excuse to pass on even bigger price hikes. Food and energy are among the industries dominated by a small number of players that have effective oligopolies, and the lack of competition allows them to keep prices high, the group said.
At least one country has already acted. Portugal introduced a windfall tax on both energy companies and major food retailers, including supermarket and hypermarket chains. It took effect at the start of January and will be in force for all of 2023.
The 33% tax is applied to profits that are at least 20% higher than the average of the previous four years. Revenue raised goes to welfare programs and to help small food retailers.
Oxfam said its analysis of 95 companies that made excess, or windfall profits, found that 84% of those profits were paid to shareholders while higher prices were passed on to consumers.
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AP reporter Barry Hatton in Lisbon, Portugal, contributed to this report.
Oxfam calls for 'billionaire-busting' policies, says the world's top 1% has been getting richer much faster than everyone else
Huileng Tan
Sun, January 15, 2023
A protest ahead of the World Economic Forum 2023 in Davos, Switzerland on January 15, 2023.Arnd Wiegmann/Reuters
The top 1% has garnered two-thirds of the $42 trillion new wealth created since 2020, per UK non-profit Oxfam.
But at least 1.7 billion workers live in countries where inflation outpaces wages.
Oxfam's calling on governments to impose much higher taxes on the super-rich to redistribute wealth.
Governments around the world need to reduce the number of ultra-wealthy people by adopting "billionaire-busting policies," Oxfam said in a Monday report.
The UK-based group of non-profits said in the report the richest people have grabbed nearly two-thirds of $42 trillion in new wealth created since 2020 — when the COVID-19 pandemic started. That's twice as much as what the rest of the 99% managed to amass in new wealth, Oxfam said citing Credit Suisse data.
As a reflection of this growing wealth disparity, at least 1.7 billion workers are living in countries where inflation is outpacing wages, according to Oxfam's analysis of data from Eurostat, Trading Economics and consultancy Korn Ferry.
Oxfam is now advocating to halve the wealth and number of billionaires between now and 2030 through taxation and other moves in order to get to a "fairer, more rational distribution of the world's wealth."
It's also seeking a permanent increase in the taxes of the richest to at least 60% of their income — in particular, Oxfam is calling on governments to raise taxes on capital gain.
"We need to do this for innovation. For stronger public services. For happier and healthier societies. And to tackle the climate crisis, by investing in the solutions that counter the insane emissions of the very richest," Gabriela Bucher, the executive director of Oxfam International, said in the report.
Just four cents of every tax dollar come from wealth taxes, according to Oxfam's analysis based on data from the Organisation for Economic Co-operation and Development.
Most of the income of wealthy people are also "unearned" and are derived from returns on their assets — but it's taxed at an average of 18% — just over half of the average top tax range on wages and salaries, according to Oxfam's study.
"Taxing the super-rich is the strategic precondition to reducing inequality and resuscitating democracy," Bucher said in the report.
Oxfam published its report just as the World Economic Forum commences on Monday in Davos, Switzerland.
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Huileng Tan
Sun, January 15, 2023
A protest ahead of the World Economic Forum 2023 in Davos, Switzerland on January 15, 2023.Arnd Wiegmann/Reuters
The top 1% has garnered two-thirds of the $42 trillion new wealth created since 2020, per UK non-profit Oxfam.
But at least 1.7 billion workers live in countries where inflation outpaces wages.
Oxfam's calling on governments to impose much higher taxes on the super-rich to redistribute wealth.
Governments around the world need to reduce the number of ultra-wealthy people by adopting "billionaire-busting policies," Oxfam said in a Monday report.
The UK-based group of non-profits said in the report the richest people have grabbed nearly two-thirds of $42 trillion in new wealth created since 2020 — when the COVID-19 pandemic started. That's twice as much as what the rest of the 99% managed to amass in new wealth, Oxfam said citing Credit Suisse data.
As a reflection of this growing wealth disparity, at least 1.7 billion workers are living in countries where inflation is outpacing wages, according to Oxfam's analysis of data from Eurostat, Trading Economics and consultancy Korn Ferry.
Oxfam is now advocating to halve the wealth and number of billionaires between now and 2030 through taxation and other moves in order to get to a "fairer, more rational distribution of the world's wealth."
It's also seeking a permanent increase in the taxes of the richest to at least 60% of their income — in particular, Oxfam is calling on governments to raise taxes on capital gain.
"We need to do this for innovation. For stronger public services. For happier and healthier societies. And to tackle the climate crisis, by investing in the solutions that counter the insane emissions of the very richest," Gabriela Bucher, the executive director of Oxfam International, said in the report.
Just four cents of every tax dollar come from wealth taxes, according to Oxfam's analysis based on data from the Organisation for Economic Co-operation and Development.
Most of the income of wealthy people are also "unearned" and are derived from returns on their assets — but it's taxed at an average of 18% — just over half of the average top tax range on wages and salaries, according to Oxfam's study.
"Taxing the super-rich is the strategic precondition to reducing inequality and resuscitating democracy," Bucher said in the report.
Oxfam published its report just as the World Economic Forum commences on Monday in Davos, Switzerland.
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