Taxing extreme wealth: what countries around the world could gain from progressive wealth taxes

In light of the global challenges of climate change, the cost of living crisis, high debt levels, and the risk of authoritarian rule, countries need stable and reliable revenue sources that do not harm their economies and societies. A moderate, progressive tax on net wealth is a tool to generate this revenue. Taxing extreme wealth not only addresses the problem of the regressivity of the income tax system for the ultra-rich but also reduces overlapping inequalities and ensures that those who have contributed the most to the planet’s destruction pay their fair share. This paper presents country-level estimates for 172 countries on the revenue potential from implementing a moderate, progressive tax on net wealth. We draw on the example of Spain’s “solidarity surcharge,” a model that has proven politically feasible, and use data from the World Inequality Database to project the revenues of adopting similar tax measures around the world. Our analysis indicates that such a tax could lead to an average increase in national budgets of 7 per cent each year. This equates to a potential global revenue of more than US$2 trillion, which is double the amount needed for developing countries’ external climate finance – a key issue expected to be at the centre of COP29 negotiations this year. Alongside this study, we provide a simple tool that allows readers to personally evaluate the country-level financial impact of net wealth taxes with different designs.