Hey #EU folks, even if you're not into #petitions, this one is absolutely worth your signature:
#TaxTheRich can force the EU Commission to consider a European #wealth #tax to finance the social and #climate transition and help countries hit by #climatechange.
The Guardian picked up that report from Dagens Naeringsliv (Business Today), which has a well-recognised neoliberal (small state, low tax) bias, so I'm not sure how reliable it is. In France, the general experience of wealth and other taxes on the super-rich is that they and their media friends make a lot of fuss, threaten to leave, a few leave, most of those fairly quickly return. A Europe-wide agreement would probably further disincentivise this reaction, as people would have to go a long way to escape it.
But the arguments in general for taxing very high income and wealth levels heavily are pretty comprehensive in my view.
For example:
1. The only period capitalism has worked reasonably well in Western Europe was in the 30 years c.1945-75, when in the aftershock of fascism, war and holocaust it was recognised that rampant inequality had led to social division and ultimately disaster, and countries built welfare states with very high redistributive marginal tax rates - which far from curtailing investment and growth seemed in fact to do precisely the opposite.
2. It's better for everybody - not only in the 'Spirit Level' sense that everybody, even the rich, are happier in more equal societies, but because it is the most just and effective way of controlling inflation.
3. And then of course it's better for the environment, because excessive income and wealth in private hands is a main driver of over-consumption.
Note these are all pretty factual points - there is also the 'natural justice' argument !
@older @ilumium
“Our request is simple: we ask you to tax us, the very richest in society,” the wealthy people said in an open letter to world leaders. “This will not fundamentally alter our standard of living, nor deprive our children, nor harm our nations’ economic growth. But it will turn extreme and unproductive private wealth into an investment for our common democratic future.”
@older @GeofCox I'm not sure the Norwegian case is necessarily representative: it's relatively easy to move from Norway to Switzerland but if much of the Western world had a high billionaire tax, where would they go? China? Russia? Seems less likely to me.
But there's another point I think that's often overlooked: a billionaire tax's function is not only to redistribute the wealth of today's billionaires but also to prevent the appearance of new ones.
Another Guardian article today reinforces the French experience -
"There are some well publicised examples of billionaires moving or threatening to move to avoid paying tax... But my conversations with the rich suggest that [they] are outliers."
https://www.theguardian.com/commentisfree/2024/jan/17/rich-think-wealth-tax-labour-party
The last article I linked addresses this point, doesn't it? Basically, some do move to tax havens (the article names 3, although I know one of these - Branson - claims it's not for tax reasons - and the other 2 are in Monaco, which would be caught in EU legislation anyway) - but most don't in fact move to tax havens anyway. Yet another article today says the same thing - this one reflecting LSE research - https://www.theguardian.com/money/2024/jan/22/super-rich-would-not-leave-uk-tax-reasons-survey
I think tax havens are more used for partial tax avoidance arrangements than for residence - and here again it seems at least some of these schemes are favoured more by legal/financial advisers - who themselves of course collect fat fees - than by the super-rich themselves (indeed there have been some cases involving celebrities who seem to have known little about their own schemes).
I accept Richard Murphy's point that there are many simpler ways to collect tax from the wealthy, especially in countries like the UK, but they are not exclusive of wealth tax. Biden has already led on international minimum corporation tax rates - I think if the EU led - as gas as it is able - on wealth taxes the rest of the world would eventually follow suit, especially if legislation included more sanctions on tax havens.
Jan Penfrat
older
GeofCox