It's a bit rich to resist taxing the super-rich

Taxing the wealth of billionaires, especially those who pay proportionately less taxes on their income than schoolteachers, isn't an idea whose time has come. Brazil is facing resistance in putting it on the agenda during its rotating presidency of G20. The US, with the highest number of billionaires, is against it. China and India, which follow in the pecking order, seem to be fence-sitters. Germany, next in line, is internally conflicted about the plan. G7 subscribes to the principle of progressive effective taxation, but is running into opposition from member countries.

This may not be the right time for a global initiative on a billionaire tax. Countries are struggling to regain fiscal balance after the pandemic and an energy shock. They are also drawing up plans for further trade fragmentation as protectionist pressures mount. The concept of taxing the super-rich at home to feed the hungry abroad recedes against immediate domestic economic priorities. Besides, taxes on wealth are expensive to administer, yielding little relative to the cost. That's why they have fallen out of favour across the world. By far the biggest apprehension is the prospect of capital flight.

Yet, the idea is here for good. Making 3,000 billionaires contribute $250 bn a year to reducing poverty grips the public imagination in an increasingly unequal world. Brazil is making a persuasive argument. It will be followed as G20 president by South Africa, one of the proponents of the tax. If China, which sees itself as the torch bearer for globalisation, and India, which aspires to leadership of the 'global south', were to come out with strong support, the argument could be swayed. Their pace of creating billionaires gives them a special place at the table.