In the context of many famous people and businessmen being involved in tax evasion scandals, in recent years, the American millionaire group Patriotic Millionaires has attracted media attention by making the call: "I'm rich, tax me" and "Tax harder" the richest people on the planet.
Eliminate injustice
According to NPR, in late 2022, residents of Whiteville, a small town in Columbus County, North Carolina (USA) were invited to weekly meetings of Patriotic Millionaires. For more than a month, dozens of residents here were given a crash course in inequality and understood why this group of wealthy people wants to pay high taxes and raise the minimum wage.
Founded in 2010, Patriotic Millionaires describes itself as a nonpartisan organization, bringing together more than 200 members who are millionaires or investors, business owners in various fields, including Abigail Disney, one of the heirs to the Disney Corporation. They describe themselves as people who “feel ashamed” of being too rich, with an annual income of over $ 1 million or assets worth more than $ 5 million. They condemn the US tax system for increasing inequality when, according to them, the average tax rate that an American has to pay corresponding to income is higher than the tax that the richest people have to pay. In 2021, the US investigative site Pro Publica revealed that the 25 richest Americans do not declare any income tax and most of their expenses are paid by businesses or loans.
At the hearing of the US Senate Finance Committee on November 9, 2023, US congressmen wanted to attack the Buy, Borrow, Die strategy that millionaires and billionaires use to avoid taxes on their assets. “Buy” is to buy and invest in stocks, real estate... to increase the value of their assets. “Borrow” is to borrow from the bank at a relatively low interest rate to pay for their living expenses, deducting the interest from their income. When they die (Die), their huge assets are transferred to their families and thus can avoid taxes.
Just a small group?
RFI quoted economist Eric Pichet, a lecturer at KEDGE Business School (France), saying that the US tax system is quite complicated and confusing, even for Americans themselves it is difficult to understand. According to Mr. Pichet, there are 7 income tax rates in the US and up to 39.6%, lower than in France (45%), but still quite high. In the US as well as elsewhere, the more money you make, the more taxes you have to pay.
There are a growing number of millionaires calling for higher taxes in the US, Canada and Europe, such as Millionaires for Humanity in the UK, Resource Movement in Canada or Tax Me Now in Germany. However, according to Mr. Pichet, the rich people who want to pay more taxes are, in fact, just for media attention and only involve a small group of individuals, not representing the majority of millionaires. “These people want to highlight their feelings of inferiority because they are too rich, but it is necessary to distinguish clearly between millionaires and billionaires. I think the target of these millionaires calling for taxes is billionaires, people who are richer than them. If I were to poll, I would say that 90% of millionaires do not intend to pay more taxes,” Mr. Pichet said.
In fact, in early 2023, US President Joe Biden proposed a minimum tax of 20% on families with assets exceeding $100 million, based on income, as well as unrealized capital gains. The White House explained that this law would target the assets of very wealthy families that have not been taxed for decades or generations, especially targeting “super” billionaires like Elon Musk or Jeff Bezos. However, according to CNBC, this proposal was quickly stifled and is unlikely to pass.
In the world, not only the US but also many other countries do not tax net assets. Only 5 countries in the Organization for Economic Cooperation and Development still maintain a tax on assets. According to expert Pichet, to establish a law on taxing assets, it is necessary for many countries to apply it, in the way that the global minimum tax rate of 15% for businesses was introduced. According to Mr. Pichet, in the next 5-10 years, there will still not be a law on taxing assets in rich countries.
However, the idea of imposing a heavy tax on the wealthy is increasingly supported by many economists and politicians, who believe that this can solve income inequality and other social problems. However, according to Mr. Pichet, if a wealth tax is applied, the economy will change because wealthy businessmen and business owners will move to another “tax haven”.
MINH CHAU
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