26 billionaires own same wealth as poorest 3.8 billion people

Published: January 21, 2019 18:08:55 | Updated: January 22, 2019 09:20:29

-Reuters file photo

The 26 richest people own as many assets as the 3.8 billion people who make up the poorest half of the planet’s population.

The development charity Oxfam International gave the information in its annual inequality report on Monday to mark the start of the World Economic Forum, which will kick off in the Swiss city of Davos on Tuesday, report Al Jazeera, The Guardian.

Billionaires around the world, who have almost doubled in number since the 2008 global financial crisis, saw their combined fortunes grow by $2.5bn a day, while the 3.8 billion people at the bottom of the scale saw their wealth decline by 11 per cent in 2018, the report said.

The report said 2018 was a year in which the rich had grown richer and the poor poorer. It urged governments to increase taxes on the wealthy to fight soaring inequality.

It said the widening gap was hindering the fight against poverty, adding that a 1 per cent wealth tax would raise an estimated $418bn (£325bn) a year – enough to educate every child not in school and provide healthcare that would prevent 3 million deaths.

Oxfam said the wealth of more than 2,200 billionaires across the globe had increased by $900bn in 2018 – or $2.5bn a day. The 12 per cent increase in the wealth of the very richest contrasted with a fall of 11 per cent in the wealth of the poorest half of the world’s population.

As a result, the report concluded, the number of billionaires owning as much wealth as half the world’s population fell from 43 in 2017 to 26 last year. In 2016 the number was 61.

Among the findings of the report were:

In the 10 years since the financial crisis, the number of billionaires has nearly doubled.

Between 2017 and 2018 a new billionaire was created every two days.

The world’s richest man, Jeff Bezos, the owner of Amazon, saw his fortune increase to $112bn. Just 1 per cent of his fortune is equivalent to the whole health budget for Ethiopia, a country of 105 million people.

The poorest 10 per cent of Britons are paying a higher effective tax rate than the richest 10 per cent (49 per cent compared with 34 per cent) once taxes on consumption such as VAT are taken into account.

The world's richest man, Amazon CEO Jeff Bezos, saw his fortune increase to $112bn last year, Oxfam said, pointing out that just one per cent of his wealth was the equivalent to the entire health budget of Ethiopia, a country of 105 million people.

Analysts found that 3.4 billion people have barely escaped extreme poverty and are living on less than $5.50 a day while stressing the growing gap between rich and poor was undermining the fight against poverty, damaging economies, and increasing public anger.

"Our economy is broken with hundreds of millions of people living in extreme poverty while huge rewards go to those at the very top," Oxfam said.

"People across the globe are angry and frustrated," warned Winnie Byanyima, Oxfam's executive director, in a statement.

"Governments must now deliver real change by ensuring corporations and wealthy individuals pay their fair share of tax," she added, arguing this money could be used for education and healthcare to lift people out of poverty.

The report also said women and girls are the hardest hit by rising inequality, as men own 50 per cent more of the total global wealth and control 86 per cent of corporations.

'Huge human costs'

Oxfam analysts acknowledged the number of extremely poor people was reduced by half between 1990 and 2010, and has since fallen further to 736 million.

They also noted, however, tax rates for high incomes have fallen in wealthy countries over the past decades.

"The super-rich and corporations are paying lower rates of tax than they have in decades," the Oxfam report said, pointing out "the human costs - children without teachers, clinics without medicines - are huge."

Calls for increased taxes on the wealthy have multiplied amid growing popular outrage in a number of countries over swelling inequality.

In the United States, new Congresswoman Alexandria Ocasio-Cortez made headlines earlier this month by proposing to tax the ultra-rich up to 70 per cent.

And in Europe, the "yellow vest" movement that has rocked France with anti-government protests since November is demanding that President Emmanuel Macron repeal controversial tax cuts on high earners.

Oxfam said getting the world's richest one per cent to pay just 0.5 per cent extra tax on their wealth could raise more money than it would cost to educate the 262 million children out of school, and provide life-saving healthcare for 3.3 million people.

It also suggested governments look again at taxes on inheritances or property, which have been reduced or eliminated in much of the developed world and barely implemented in the developing world.

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