U.S. billionaires now have a lower effective tax rate than working-class

For instance, in 2018, the United States cut its maximum corporate tax rate to 21 percent from 34 percent, and the estate tax has almost disappeared in America, diminishing the tax burden on profits that largely benefit the ultra-rich.

Global response and push for fair taxation

This phenomenon is not limited to the U.S.; it reflects a broader international issue where the wealthy exploit tax regulations to their advantage.

For instance, in European countries like Italy and France, the ultrawealthy enjoy considerably lower tax rates. This trend is consistent globally, as seen in countries like the Netherlands, where the average taxpayer contributed 45% of their earnings in 2016, while billionaires paid just 17%.

The widening gap in tax contributions has spurred international efforts, including a 2021 agreement by over 130 countries to set a global minimum corporate tax rate of 15%, ensuring that large multinational companies pay a baseline amount of tax regardless of where they park their profits.

There are also growing calls for a wealth tax on billionaires, proposing they pay taxes on a portion of their overall wealth each year—a move that could significantly bolster public finances.

Countries such as Brazil, chairing this years Group of 20 summit, along with France, Germany, South Africa, and Spain, have recently expressed support for a minimum tax on billionaires.

In the United States, President Biden has proposed a similar billionaire tax, aiming not just to raise revenue but to rectify a tax system that currently permits significant disparities, threatening economic balance and undermining democratic values.

As debates intensify, the focus sharpens on creating a tax regime that better reflects the economic contributions and benefits derived by the wealthiest, promoting a fairer and more equitable society.