At the global level, the wealthiest 20 billionaires have a combined $1.83 trillion in wealth –with an increase of $742 billion, or 68 percent, over the pandemic year. In comparison, the 2019 GDP of Spain was US $1.3 trillion.
While billionaires were getting richer, the pandemic caused the global economy to shrink by 3.5 percent in 2020, according to the International Monetary Fund. COVID-19 has been an accelerant on global inequality, with acute adverse impacts on women, youth, the poor, the informally employed, and those who work in contact-intensive sectors.
The Need for Wealth Taxation
If global billionaires had paid an annual wealth tax in 2020, modelled on the “Ultra-Millionaire Tax” levy proposed by U.S. Senator Elizabeth Warren, they would have paid an estimated $345 billion in wealth taxes. Based on the current expectations of wealth growth, a small wealth tax such as this would raise $4.14 trillion over the next decade. Of course, there is no institutional body to levy such a global wealth tax and this is for illustrative purposes.
The “Ultra-Millionaire Tax” would levy an annual 2 percent wealth tax on assets over $50 million –and a 3 percent tax on assets over $1 billion. Our estimates track this law by exempting wealth under $50 million and tax assets between $50 million and $1 billion at a 2 percent rate.
The annual revenue from this wealth tax would be more than twice the estimated $141.2 billion cost of delivering COVID-19 vaccines to every person on the planet, according to estimates from Oxfam.
The U.S. accounts for less than one-third of billionaire wealth on the global list. In the US alone, if this tax was applied to US billionaires on the Forbes Billionaires List, this would generate $120 billion a year, or $1.5 trillion over the next decade.