By Marcela Ayres and Andrea Shalal
WASHINGTON (Reuters) – Brazil’s Finance Minister Fernando Haddad said on Wednesday that the proposal to tax the super-rich presented by the country during its presidency of the G20 group is “gaining momentum,” and in a world marked by geopolitical tensions, this move could garner consensus for building a better common future.
Speaking on the sidelines of the International Monetary Fund and World Bank spring meetings, he stressed the G20 would seek international consensus on the taxation of wealth and would discuss a joint declaration at the group’s next meeting in July.
“The G20 declaration that we are going to propose aims to politically back these initiatives,” he said, adding that it would be crucial to have finance ministers from the biggest economies on the same page.
His French counterpart Bruno le Maire, who had already expressed support for the Brazilian proposal, said on Wednesday while participating at the same event that Paris fully supports the push for taxation on the wealthiest.
Meanwhile, IMF chief Kristalina Georgieva urged focus on closing tax loopholes.
Haddad had earlier told Reuters that Wednesday’s G20 working dinner would discuss how funds raised through this new avenue of taxation could address combating hunger and transitioning to a greener economy.
Haddad also mentioned that the presence of Nobel Prize-winning economist Esther Duflo at the dinner would precisely serve this purpose, after Brazil initially invited Gabriel Zucman, director of the European Tax Observatory, to assist in shaping a report on the matter, which Haddad reiterated should be ready by the next G20 finance track meeting in July.
“If we can achieve consensus on this by the end of the year, it’s such an extraordinary thing… it’s historic,” he said.
Zucman suggested that one possibility would be to ensure that very high-net-worth individuals pay at least the equivalent of 2% of their wealth in income tax each year, which he estimated could generate $250 billion per year – half of the annual revenue projected as necessary for developing countries to address climate change challenges.
(Reporting by Marcela Ayres; Editing by Steven Grattan and Nick Zieminski)
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