The Richest 1% bag nearly twice as much wealth as the rest of the world put together over the past two years

Globally,

• Super-rich outstrip their extraordinary grab of half of all new wealth in past decade.
• Billionaire fortunes are increasing by $2.7 billion a day even as at least 1.7 billion workers now live in countries where inflation is outpacing wages.
• A tax of up to 5 percent on the world’s multi-millionaires and billionaires could raise $1.7 trillion a year, enough to lift 2 billion people out of poverty.

In Nigeria

1. The richest 0.003% Nigerians (6,355 individuals worth $5 million and above) have

1. 4 times more wealth than 107 million Nigerians.

2. The wealth of Nigeria billionaires has grown by a third since the start of the COVID-19 pandemic.

3. The 3 richest men in Nigeria have more wealth than 83 million Nigerians.

4. A wealth tax of 2% on the millionaires, 3% on those with wealth above $50 million and 5% on the Nigerian billionaires would raise $3.2 billion dollars annually. This would be enough to double health spending. Nigeria has one of the lowest health budgets in the world.

The richest 1 percent grabbed nearly two-thirds of all new wealth worth $42 trillion created since 2020, almost twice as much money as the bottom 99 percent of the world’s population, reveals a new Oxfam report today. During the past decade, the richest 1 percent had captured around half of all new wealth.

“Survival of the Richest” is published on the opening day of the World Economic Forum in Davos, Switzerland. Elites are gathering in the Swiss ski resort as extreme wealth and extreme poverty have increased simultaneously for the first time in 25 years.

“For over five years, Nigeria spent an average of 49% of its revenue on debt servicing, and in 2020, before COVID, this was expected to be 29% or $6 billion. This amount was almost four times the education and social protection budgets, six times the health budget and 14 times the agriculture budget.

Despite Nigeria having one of the lowest tax to GDP ratios in the world with just 3.6% in 2019, Nigeria spent 80.6% of its revenue on debt servicing in 2022. Nigeria While millions of Nigerians are unsure where their next meals will come from, the super-rich are getting richer and not paying their fair share of taxes but taking advantage of the complexities and loopholes in the tax legislation, as well as the lack of transparency and accountability in tax implementation, thereby depriving the country of the revenue needed for social protection and inequality reduction” said Dr. Vincent Ahonsi, Country Director, Oxfam International.

“Taxing the super-rich and big corporations is the door out of today’s overlapping crises. It’s time we demolish the convenient myth that tax cuts for the richest result in their wealth somehow ‘trickling down’ to everyone else. Forty years of tax cuts for the super-rich have shown that a rising tide doesn’t lift all ships —just the superyachts.”

Billionaires have seen extraordinary increases in their wealth. During the pandemic and costof- living crisis years since 2020, $26 trillion (63 percent) of all new wealth was captured by the richest 1 percent, while $16 trillion (37 percent) went to the rest of the world put together. A billionaire gained roughly $1.7 million for every $1 of new global wealth earned by a person in the bottom 90 percent. Billionaire fortunes have increased by $2.7 billion a day. This comes on top of a decade of historic gains —the number and wealth of billionaires having doubled over the last ten years. Billionaire wealth surged in 2022 with rapidly rising food and energy profits. The report shows that 95 food and energy corporations have more than doubled their profits in 2022 and paid out $257 billion (84 percent) of that to rich shareholders. The Walton dynasty, which owns half of Walmart, received $8.5 billion over the last year. Indian billionaire Gautam Adani, owner of major energy corporations, has seen this wealth soar by $42 billion (46 percent) in 2022 alone. Excess corporate profits have driven at least half of inflation in Australia, the US and the UK.

At the same time, at least 1.7 billion workers now live in countries where inflation is outpacing wages, and over 820 million people —roughly one in ten people on Earth— are going hungry. Women and girls often eat least and last, and make up nearly 60 percent of the world’s hungry population. The World Bank says we are likely seeing the biggest increase in global inequality and poverty since WW2. Entire countries are facing bankruptcy, with the poorest countries now spending four times more repaying debts to rich creditors than on healthcare. Threequarters of the world’s governments are planning austerity-driven public sector spending cuts —including on healthcare and education— by $7.8 trillion over the next five years.

Oxfam is calling for a systemic and wide-ranging increase in taxation of the super-rich to claw back crisis gains driven by public money and profiteering. Decades of tax cuts for the richest and corporations have fueled inequality, with the poorest people in many countries paying higher tax rates than billionaires.

Elon Musk, one of the world’s richest men, paid a “true tax rate” of about 3 percent between 2014 and 2018. Aber Christine, a flour vendor in Uganda, makes $80 a month and pays a tax rate of 40 percent.

Worldwide, only four cents in every tax dollar now comes from taxes on wealth. Half of the world’s billionaires live in countries with no inheritance tax for direct descendants. They will pass on a $5 trillion tax-free treasure chest to their heirs, more than the GDP of Africa, which will drive a future generation of aristocratic elites. Rich people’s income is mostly unearned, derived from returns on their assets, yet it is taxed on average at 18 percent, just over half as much as the average top tax rate on wages and salaries.

The report shows that taxes on the wealthiest used to be much higher. Over the last forty years, governments across Africa, Asia, Europe, and the Americas have slashed the income tax rates on the richest. At the same time, they have upped taxes on goods and services, which fall disproportionately on the poorest people and exacerbate gender inequality. In the years after WW2, the top US federal income tax rate remained above 90 percent and averaged 81 percent between 1944 and 1981. Similar levels of tax in other rich countries existed during some of the most successful years of their economic development and played a key role in expanding access to public services like education and healthcare.

“With widening inequality and 133 million (63%) Nigerians suffering from multidimensional poverty, the richest people and corporations in Nigeria are unfazed and are getting richer.

With over 20 million children out of school, it is inappropriate to continue to give wealthy individuals and corporations tax breaks, incentives and waivers.

With about six out of ten Nigerians lacking access to quality primary healthcare services, a situation that is worsening disease outbreaks and out-of-pocket expenditure, it is unfair for the wealth of Nigeria billionaires to grow by a third since the start of COVID-19 pandemic without a corresponding increase in health budgets.

To have a more secured and prosperous society, Nigeria needs to purposely work to reduce inequality, generate more tax revenues from the rich, spend more on health, education, agriculture and social protection; and provide fair, inclusive, and gender-sensitive opportunities for its citizens” said Dr. Ahonsi.

According to new analysis by the Fight Inequality Alliance, Institute for Policy Studies, Oxfam and the Patriotic Millionaires, an annual wealth tax of up to 5 percent on the world’s multimillionaires and billionaires could raise $1.7 trillion a year, enough to lift 2 billion people out of poverty, fully fund the shortfalls on existing humanitarian appeals, deliver a 10-year plan to end hunger, support poorer countries being ravaged by climate impacts, and deliver universal healthcare and social protection for everyone living in low- and lower middle-income countries.

Oxfam is calling on governments to:

• Introduce one-off solidarity wealth taxes and windfall taxes to end crisis profiteering.
• Permanently increase taxes on the richest 1 percent, for example to at least 60 percent of their income from labor and capital, with higher rates for multi-millionaires and billionaires. Governments must especially raise taxes on capital gains, which are subject to lower tax rates than other forms of income. 
• Tax the wealth of the richest 1 percent at rates high enough to significantly reduce the numbers and wealth of the richest people, and redistribute these resources. This includes implementing inheritance, property and land taxes, as well as net wealth taxes.