2023-10-23 01:47:00
A report published by the European Tax Observatory could provide grist for the French government’s mill. The latter succinctly mentioned the idea of a new tax, on a global scale, taxing the wealth of billionaires at 2%. If such a tax were implemented, it could generate around 40 billion euros in revenue for European states.
“Billionaires around the world have effective tax rates ranging from 0 to 0.5% of their wealth, due to the frequent use of shell companies to evade income tax,” deplores this research laboratory. research led by French economist Gabriel Zucman. Funded in particular by the European Union, the Observatory proposes to establish a global minimum tax on the assets of some 2,800 billionaires, the rate of which would be set at 2%.
The principle of this levy is reminiscent of that of the minimum tax of 15% on corporate profits, which is gradually being rolled out across the world after the conclusion of an international agreement under the aegis of the OECD, at the end of 2021. Currently , European billionaires only pay $6 billion in taxes per year, assures the Observatory.
But, by taxing their assets at 2%, these tax revenues could increase sevenfold to reach 42.3 billion dollars (40 billion euros) in Europe – and more than 200 billion euros globally. For the Nobel Prize winner in economics Joseph Stiglitz, who prefaced the report, these recipes “are essential to our societies […] at a time when governments need to make essential investments in education, health, infrastructure and technology.”
The communists aim for 5%
In September, French Minister for Public Accounts Thomas Cazenave said he wanted to create a “transpartisan working group” to consider international personal taxation. The government rules out any new national tax on the wealth of the wealthiest, judging that such a levy must be decided at the European or international level.
At the end of September, Communist MPs Nicolas Sansu and MoDem Jean-Paul Mattei suggested in a report introducing an exceptional and temporary tax on the assets of the wealthiest Europeans. “A levy of 5% spread over 30 years, based on the net financial assets of the 10% best endowed, would provide 150 billion euros,” they calculated.
In its report which takes stock of recent reforms to the international tax system, the Observatory on Monday welcomed the success of the automatic exchange of banking information, in force since 2017. While “the majority” of financial assets placed by households in tax havens were not declared to the tax authorities before 2013, ten years later, only approximately 25% of this wealth “evades tax”.
The global minimum corporate tax, on the other hand, has been “considerably weakened”, regrets the hundred researchers who contributed to the report. Indeed, the agreement negotiated at the OECD contains an exemption which allows companies to exclude part of their assets and their payroll from the tax base. Their real tax rate therefore falls significantly below the 15% theoretically expected.
The Observatory therefore suggests raising the tax rate from 15 to 25%, which would almost triple tax revenues.
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