Richest 1% amassed $42 trillion over past decade – 34 times more than the poorest half made

The richest 1% of people in the world amassed $42 trillion in new wealth over the past decade, nearly 34 times more than the entire bottom 50% of the world’s population.

The average wealth per person in the top 1% rose by nearly $400 000 in real terms over the last decade compared to just $335, an equivalent increase of less than nine cents a day, for someone in the bottom half.

These astounding figures come from a new Oxfam analysis ahead of the third meeting of G20 Finance Ministers and Central Bank Governors in Rio de Janeiro, Brazil, last week, where they lay the foundations of a groundbreaking global deal to increase taxes on the super-rich.

Championed by the Brazilian G20 Presidency and backed by countries including South Africa, Spain and France, the proposal came amid growing public demand for measures to rein in extreme levels of inequality and ensure that the rich pay their fair share.

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Oxfam on Saturday welcomed the G20 Ministerial Declaration on International Tax Cooperation agreed to in Rio de Janeiro.

“Inequality has reached obscene levels and until now governments failed to protect people and the planet from its catastrophic effects. The richest 1% of humanity continues to fill their pockets while the rest are left to scrap for crumbs,” Max Lawson, Oxfam International’s head of inequality policy, says.

“Momentum to increase taxes on the super-rich is undeniable and this week was the first real litmus test for G20 governments to show they have the political will to strike a global standard that puts the needs of the many before the greed of an elite few.”

War on taxation saw tax on rich collapse

A “war on fair taxation” has seen tax rates on the wealth and income of the richest collapse. Oxfam calculates that less than eight cents in every dollar raised in tax revenue in G20 countries now comes from taxes on wealth.

In addition, Oxfam calculated that to keep billionaires’ wealth constant over the last two decades, we would have needed an annual net wealth tax of more than 8% across all countries. To keep their wealth constant between 2016 and 2021, we would have needed an annual net wealth tax of 12.8%.

During the same period, the top tax rates on their incomes fell by roughly a third, from around 60% in 1980 to 40% in 2022).

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According to Oxfam, billionaires have been paying a tax rate globally equivalent to less than 0.5% of their wealth. Their fortunes increased by an annual average of 7.1% over the last four decades. An annual net wealth tax of at least 8% is needed to reduce billionaires’ extreme wealth. G20 countries are home to nearly four out of five of the world’s billionaires.

Oxfam, Avaaz, the Patriotic Millionaires, TaxMeNow, 350.org, the Fight Inequality Alliance and WeMoveEurope handed over petitions with more than 1.5 million signatures from people across the world calling on G20 leaders to tax the ultra-rich to Brazilian finance minister Fernando Haddad in Rio de Janeiro on 24 July.

Oxfam SA congratulates Godongwana for support of declaration

Meanwhile, Oxfam South Africa says close to 20 former heads of state and governments of G20 and higher-income countries called on current G20 leaders, including US President Joe Biden, German Chancellor Olaf Scholz and UK Prime Minister Keir Starmer, to support a “new global deal to tax the world’s ultra-rich individuals” in an open letter.

Susana Ruiz, Oxfam International’s tax policy lead, says polling consistently finds that most people across countries support raising taxes on the richest. It is not only governments and poor people that support more tax for the rich.

Ruiz says nearly three-quarters of millionaires polled in G20 countries support higher taxes on wealth and more than half think extreme wealth is a “threat to democracy”, with 72% thinking that extreme wealth helps buy political influence.

Oxfam South Africa congratulated Finance Minister Enoch Godongwana for supporting the declaration, which includes a commitment to working together to ensure that ultra-high-net worth individuals are taxed more effectively.

According to Oxfam, South Africa is the most unequal country in the world. The country’s top five dollar billionaires have a combined wealth of $29 billion. The country’s billionaires’ combined wealth increased by a third since 2020, while the bottom 99% became poorer.

Ruiz says the declaration is serious global progress. “For the first time in history, the world’s largest economies agreed to cooperate to tax the ultra-rich. Finally, the richest people are being told they cannot game the tax system or avoid paying their fair share.

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Governments complicit in helping richest 1% avoid paying tax

“Governments have for too long been complicit in helping the ultra-rich pay little or zero tax. Massive fortunes afford the world’s ultra-rich outsized influence and power, which they wield to shield, stash and supersize their wealth, undercutting democracy and widening inequality.”

She says the next step will be taken at the G20 Summit in November this year.

“Leaders must go further than their finance ministers and back concrete coordination: agreeing on a new global standard that taxes the ultra-rich at a rate high enough to close the gap between them and the rest of us.”

Brazil kickstarted a truly global approach to taxing the ultra-rich, but the work is just beginning and international cooperation is crucial, she says.

“We call on G20 leaders to align with the progress at the UN and establish a truly democratic process for setting global standards on taxing the ultra-rich. Entrusting this task to the Organisation for Economic Co-operation and Development (OECD), the club of mostly rich countries, would simply not be good enough.”

In April 2024 Godongwana backed a global deal on taxing the super-rich, along with Svenja Schulze (German minister for economic cooperation and development) Fernando Haddad (Brazilian finance minister), María Jesús Montero (Spanish minister of finance) and Carlos Cuerpo (Spanish minister of economy, trade and business).