MercoPress. South Atlantic News Agency

Brazil's Finance Minister hopes G20 will tax the super‑rich to tackle world's debt crisis

Haddad recalled that Biden's government was holding thoughts along the same lines regarding the wealthiest people

During his trip to Washington DC to attend International Monetary Fund (IMF) and World Bank (WB) engagements, Brazil's Finance Minister Fernando Haddad said he hoped the G-20 would approve later this year a new taxation for the planet's super-rich so that the global economy could adjust amid an unprecedented debt crisis, Agencia Brasil reported.

The G-20 brings together the 20 largest economies in addition to the European Union and the African Union. It is scheduled to host its annual summit in Rio de Janeiro in November given Brazil's rotating presidency of the bloc this year.

Haddad said the US administration of President Joseph Biden supported his initiative, which is already underway in South America's biggest country.

“In July, and then in November, we can release a political communiqué with the consent of the G20 members saying yes, this proposal should be examined, it’s well-founded, and it’s worth poring over it for the next three or four years to understand what we’re talking about,” said Haddad during a press conference alongside his French colleague Bruno Le Maire.

Despite the apparent consensus, the Brazilian finance minister said G20 countries should treat the issue as a priority in the coming years. Taxation by just one nation would be ineffective and could lead to conflicts of interest, he also warned. “If any country thinks it’s going to solve this kind of injustice on its own, it will be harmed by a kind of fiscal war between national states,” he stressed.

“The Biden administration has given clear signals that something needs to be done either domestically or internationally,” he went on.

The joint G20 communiqué should have three pillars: the exchange of data between countries, technical support from the Organization for Economic Cooperation and Development (OECD), and a short deadline for implementing the measures showing the countries’ commitment to taxation.

Le Maire said he agreed on the need to approve the measure. “This is just a question of political will and political determination.”

Haddad also noted from the US capital that the world could be on the brink of a new debt crisis, following the costs of the Covid-19 pandemic and the rise in global inflation. During a G20 event to combat poverty and hunger, he insisted that no country would overcome the problem independently, and taxing the richest was key to reducing that debt.

“Talks on taxation are exploring innovative ways of making the super-rich pay their fair share of taxes, helping expand the additional fiscal space for implementing public policies against hunger and poverty,” Haddad underlined.

The IMF this week suggested Brazil made a more “ambitious” fiscal effort and cut more spending or increase revenue. “The fact that the IMF says our debt is stabilizing at a better level than they initially assumed is significant, but the challenge is real. If there’s one person who has never denied that we have a fiscal challenge, it’s yours truly,” Haddad explained.

The minister was due to stay in Washington DC until Friday.

(Source: Agencia Brasil)