$214 billion would be raised by a 2% tax on billionaires

The European Tax Observatory estimates that a new 2% tax on the 2,756 individuals worldwide who own assets worth more than $1 billion would generate $214 billion, correcting the low rates currently applied to them.

This group, which is directly associated with Nobel Prize laureate Joseph Stiglitz and is headed by the French economist Gabriel Zucman, highlights in a paper released on Monday that billionaires pay tax rates of barely 0% to 0.5% of their wealth.

Their taxation is notably lower than that of other demographic groups in part because they frequently employ tools like personal corporations (in the form of holding companies) to hold mostly financial assets that are free from dividend taxation.

The study’s authors also point out that, after accounting for inflation, the wealth of this select group of billionaires has grown at an average yearly rate of 7% since 1995.

The proposed new 2% tax would generate $72.3 billion in North America, $60.3 billion in South and Southeast Asian countries and $42.3 billion in Europe.