US is against Brazil’s proposal for a global tax on billionaires

US Treasury Secretary Janet Yellen said Washington is not in favor of creating a global tax on billionaires’ wealth. The idea is suggested by countries such as Brazil and France. The government of President Luiz Inácio Lula da Silva (PT) wants to take advantage of the Brazilian presidency of the G20 to discuss the issue.

“We believe in progressive taxation”, said Yellen, quoted by the newspaper Wall Street Journal. She declared that the U.S. “do not support” none “common global agreement” for “tax billionaires with income redistributed in some way”. She said: “This is something we can’t sign”.

Brazil wants the G20 to analyze the creation of a coordinated approach to taxing the super rich, who can now transfer their capital to places with lower taxes. The idea is to mirror the agreement that around 140 countries signed in 2021, to charge a global minimum tax of 15% from multinationals. The implementation of this tax has faced obstacles from the US and other countries.

In February this year, the Minister of Finance, Fernando Haddad, defended the creation of a global minimum tax on the wealth of billionaires around the world. In a speech broadcast at a G20 meeting in São Paulo, he said that the measure would act as an important pillar for international tax cooperation and for the debate on the progressive taxation of large fortunes, an issue dear to Planalto.

“Recognizing the progress made in the last decade, we need to admit that we still need to make the world’s billionaires pay their fair share in taxes. In addition to seeking to advance ongoing negotiations at the OECD [Organização para a Cooperação e Desenvolvimento Econômico] yes in ONU [Organização das Nações Unidas]we believe that a global minimum taxation on wealth could constitute a 3rd pillar for international tax cooperation”, he declared. Here is the minister’s full speech (PDF – 367 kB).