The richest 1 per cent have amassed $42 trillion in new wealth over the past decade, nearly 34 times more than the entire bottom 50 per cent of the world’s population, according to charity Oxfam International.
The average wealth per person in the top 1 per cent rose by nearly $400,000 in real terms over the past decade compared to just $335 – an equivalent increase of less than nine cents a day – for a person in the bottom half, the research found.
The world’s top five richest people are: Elon Musk with a net worth of $243 billion, Jeff Bezos ($205 billion), Bernard Arnault ($188 billion), Mark Zuckerberg ($166 billion) and Bill Gates ($156 billion), according to the Bloomberg Billionaire’s Index.
“Inequality has reached obscene levels, and until now governments have failed to protect people and planet from its catastrophic effects,” said Max Lawson, Oxfam International’s head of inequality policy.
“The richest one per cent 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 was 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?”
The number of billionaires rose by 7 per cent globally last year to 2,544 from 2,376, while their collective wealth recovered by 9 per cent to $12 trillion from $11 trillion, according to a report by Swiss banking group UBS.
The world’s five richest people have more than doubled their collective wealth to $869 billion, from $405 billion, since 2020, as almost five billion people globally – 60 per cent of the world's population – have grown poorer, according to a January report by Oxfam.
If each of the planet's five wealthiest men were to spend $1 million daily, they would take 476 years to exhaust their combined wealth, Oxfam said in its annual Inequality Inc report, which was released during the World Economic Forum meeting in Davos.
At the current rate, it would take 230 years to end poverty – but the world could have its first trillionaire in 10 years' time, Oxfam said at the time.
This week, Group of 20 finance chiefs pledged to continue “dialogue on fair and progressive taxation, including of ultra-high-net-worth individuals”, a reference to the 2 per cent minimum tax on billionaires that Brazil President Luiz da Silva has made the centrepiece of his nation’s year on top of the group, after debating the idea this week in Rio de Janeiro.
The idea has split the G20 and the Group of 7 since it was initially unveiled in February, winning support from nations like France and South Africa while the US and others rejected it.
Brazil has spurred discussion of a proposal to levy a 2 per cent wealth tax on fortunes over $1 billion, raising estimated revenue of up to $250 billion annually from 3,000 individuals.
Oxfam has calculated that less than eight cents in every dollar raised in tax revenue in G20 countries now comes from taxes on wealth.
The share of income of the top 1 per cent of earners in G20 countries has risen by 45 per cent over four decades, while top tax rates on their incomes were cut by roughly a third, Oxfam’s research found.
“Globally, billionaires have been paying a tax rate equivalent to less than 0.5 per cent of their wealth,” according to Oxfam.
“Their fortunes have risen by an annual average of 7.1 per cent over the last four decades, and an annual net wealth tax of at least 8 per cent would be needed to reduce billionaires’ extreme wealth. G20 countries are home to nearly four out of five of the world’s billionaires.”
The first-ever joint declaration by G20 finance leaders vowing to co-operate on effectively taxing the world's largest fortunes on Friday papered over deeper disagreement about the right forum to advance the agenda.
“We will seek to engage cooperatively to ensure that ultra-high-net-worth individuals are effectively taxed,” said the final draft of the G20 ministerial declaration in Rio de Janeiro, Reuters reported.
However, fault lines have emerged about whether to do that in talks at the United Nations or through the Organisation for Economic Cooperation and Development (OECD), a group of wealthier democracies founded by US and European allies.
“We call on G20 leaders to align with the progress being made at the UN and establish a truly democratic process for setting global standards on taxing the ultra-rich,” said Oxfam International's tax policy lead Susana Ruiz.
“Entrusting this task to the OECD – the club of mostly rich countries – would simply not be good enough,” she added.
