Billionaire Tax Proposal: Leading Nations Write History to End Hunger and Defy Injustice

Publicerad denFörfattareKontrast.at

For the first time, the world’s richest countries are taking steps to tax billionaires globally. Economist Gabriel Zucman has introduced a simple yet powerful idea: a 2% tax on billionaire wealth. This tax could raise $250 billion every year. To put it simply, just $23 billion of that money could end hunger worldwide. The G20 nations have now agreed to work together on this historic plan. It marks a major step toward creating a fairer global tax system.
Imagine a world without hunger. According to Oxfam, $23 billion (USD) a year would be enough to eliminate hunger and malnutrition. That’s less than 10% of what a global billionaire tax could raise annually.
But the potential goes far beyond feeding the hungry. The extra funds could transform education systems, build hospitals in underserved areas, and fund vital research on climate change. Some of the money could also support startups tackling social and environmental challenges.
How a Small Tax Could Change the World
The plan is straightforward. Around 3,000 billionaires worldwide would pay a minimum of 2% of their wealth in taxes each year. Those who already pay equivalent income taxes would not be affected.
Right now, billionaires often pay just 0.5% of their wealth in taxes. Under this new proposal, their contributions would finally reflect their immense resources. Experts estimate that this change could raise $250 billion annually.
To put it into perspective: Jeff Bezos, with a net worth of over $205 billion, and Mark Zuckerberg, worth $167 billion, would both contribute substantial amounts.
From Decades of Talks to Real Progress
After more than 10 years of discussions, G20 nations have finally begun to act. Last year, they reached a historic agreement on global corporate taxes. Now, they are turning their attention to taxing the world’s wealthiest individuals.
In June 2024, Zucman presented his plan to the G20 under Brazil’s leadership. His report (“A blueprint for a coordinated minimum effective taxation standard for ultra-high-net-worth individuals“) outlined how the tax could work on a global scale, ensuring fairness and effectiveness.
G20 Leaders Commit to Change
Countries like France, Spain, Colombia, and members of the African Union have expressed strong support for the plan. At the G20 summit in Rio de Janeiro, finance ministers pledged to collaborate on taxing billionaires more effectively.
Brazil, led by President Luiz Inácio Lula da Silva, has made tackling inequality a top priority. This agreement is an important first step toward making the billionaire tax a reality.
Is the World Ready for a Billionaire Tax?
Many experts and activists see this as a turning point. NGOs have also welcomed this step by the G20. Martin Kaiser, Executive Director of Greenpeace Germany, stated:

“The G20 are not letting the world’s billionaires off the hook for their responsibility in climate destruction. The development of a billionaire tax will continue. That alone is good news for greater fairness. It cannot be that the excessive lifestyles of just a few thousand billionaires around the world are massively fueling the climate crisis, which threatens us all.”

However, not all countries are on board. Major economies like the U.S., India, and China have reservations. For now, each nation decides how to tax its billionaires.
Meanwhile, the UN has approved a new global tax agreement aimed at preventing tax evasion by the world’s ultra-rich. Advocacy groups have called this move the most significant tax policy shift in decades.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast / Jasmin Mahmoud as the original source/author and set a link to this article on TheBetter.news. https://thebetter.news/portugal-drug-policy/ The rights to the content remain with the original publisher. Läs mer…

Saving Lives, Changing Minds: How Portugal is Winning the War on Drugs

Publicerad denFörfattareKontrast.at

Portugal has taken a bold step in its way out of the drug crisis, addressing drug use by choosing to focus on health and support instead of punishment—and the results are remarkable. Since decriminalizing drug possession in 2001, drug-related deaths have dropped sharply, HIV infections have declined, and more people are accessing support services. Portugal’s approach is inspiring a global conversation about rethinking the war on drugs, shifting focus to prioritize public health over criminalization.
A New Approach: Help Instead of Punishment
Portugal’s drug policy shifts the focus from punishment to rehabilitation. Being caught with small amounts of drugs for personal use no longer leads to arrest or imprisonment. Instead, individuals are referred to “Commissions for the Dissuasion of Drug Addiction.” These teams—composed of psychologists, social workers, and legal experts—assess the individual’s situation.
Their aim is to understand why the person uses drugs and what kind of support they need, whether that’s counseling, treatment, or social services. This innovative approach treats drug use as a health issue rather than a crime, breaking down barriers that often prevent people from seeking help.
Real Results: Fewer Deaths, Better Health
The impact of this shift has been profound. Drug-related deaths in Portugal are now among the lowest in Europe. Before decriminalization, the country faced a public health crisis, with hundreds of deaths and rising HIV rates among drug users.
Today, these numbers have dropped significantly. Portugal’s harm reduction programs, such as the distribution of clean needles and access to voluntary therapy, have played a key role in these improvements. These services reduce the risk of infections like HIV and hepatitis while encouraging people to seek help without fear of legal consequences.
Portugal’s way out of the drug crisis: Building Trust and Preventing Harm
Another critical component of Portugal’s strategy is the establishment of drug consumption rooms. These spaces allow individuals to use drugs under medical supervision, preventing overdoses and ensuring immediate medical assistance when needed. They also provide clean equipment to reduce the spread of infectious diseases and serve as entry points for people to connect with healthcare services. For many, these safe spaces are the first step toward recovery.
Problematic Drug Use and Social Factors
One of the most striking outcomes of Portugal’s policy is the decline in “problematic” drug use—defined as frequent and high-risk use. This has decreased significantly, particularly among young people. Experts attribute this to a combination of decriminalization, education, and accessible support services that are designed to tackle not just the symptoms of drug use but also the root causes.
Portugal’s strategy goes further by addressing the social and economic factors that contribute to addiction. Programs focus on reintegrating individuals into society, offering job training, housing assistance, and social support. By addressing these root causes of addiction, Portugal aims to break the cycle of addiction and improve overall well-being.
A Model for the World?
Portugal’s success is an example of how compassionate, health-focused policies can address drug issues more effectively than punishment. The combination of decriminalization, harm reduction services, and efforts to tackle underlying social issues provides a comprehensive model for sustainable change.
This approach has inspired discussions in countries worldwide. For instance, nations like Canada and Switzerland have implemented similar harm reduction measures, although on a smaller scale. Yet many countries remain hesitant, clinging to punitive measures despite mounting evidence that they are less effective.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast / Sophie Wenkel as the original source/author and set a link to this article on TheBetter.news. https://thebetter.news/portugal-drug-policy/

The rights to the content remain with the original publisher. Läs mer…

Unbreakable: Duralex Glass Heritage Saved by Its Workforce

Publicerad denFörfattareKontrast.at

They complement every French bistro like a petit café after a meal: Glasses from Duralex have cult status in France and are very popular internationally. Nevertheless, after several difficult years, the French glass manufacturer was on the verge of collapse. High energy prices and declining sales pushed the company to the brink of insolvency. After multiple takeovers and bankruptcy proceedings, the workforce took charge of Duralex by founding a cooperative, preserving all jobs—and securing the company’s future.
Hailed by the New York Times as one of the best drinking glasses in the world, Duralex products are enjoying great popularity worldwide. Indiana Jones used them to drink his whiskey and James Bond managed to catch a scorpion with a Duralex glass after emptying it.
But the story of these iconic tumblers with the round belly begins much earlier in the heart of France. In 1945, Duralex was founded in La Chapelle-Saint-Mesmin, a suburb of Orléans. Since then, glasses have been manufactured here using a special, patented process and sold all over the world.
Iconic Glasses Made in France
Few drinking glasses can claim to be as sturdy and iconic as this one. In France, there is hardly any person who has not drunk out of a Duralex glass at some point. Even in school, children learn about the properties of these glasses, which can be dropped and yet will not break. For many, Duralex glasses are not only functional, but also part of their collective memory. The number in the glass bottom, an indication of the production mold, became a game for generations of schoolchildren: whoever had the highest number had to fetch the water for the others.
Long-Standing Company Under Pressure
However, the resilience of its glasses cannot be deduced from the economic resilience of the company. Duralex is not the only long-standing company that has come under economic pressure in recent years. Increasing competition from low-wage countries and high energy costs made domestic manufacturing more and more difficult. In particular, the energy-intensive process of glass tempering, in which the glass is first heated to a high temperature and then cooled rapidly, became increasingly expensive. The company was only incurring losses.
Ultimately, the pandemic dealt Duralex the final blow. Insolvency seemed inevitable. After several changes of direction and insolvency proceedings, the company even suspended production for a short time.
Two companies submitted takeover offers. Both included plans for massive job cuts. The case was taken to court in Orléans.
Duralex Employees Set Up a Cooperative and Secure All Jobs
After tough negotiations, the court in Orleans ruled in July 2024 to accept the employees’ plan to found a cooperative. The workforce saved all jobs by uniting more than half of its members to take control over the future of the iconic glasses and invest in their own company. In a statement, the newly founded cooperative said:
‘We are taking our destiny into our own hands and are determined to advance our company, an icon of French industry, in an ambitious transformation project.’
There was support from politicians and authorities. The cooperative received around €10 million to purchase the production site and preserve jobs in the factory and at suppliers.
But more power brings greater responsibility. The employees are now involved in all decisions in a board of directors. They elected the former plant manager, François Marciano, as director. He is supposed to help them get the company back on track. The first step is to convince the rest of the workforce and then the whole world of the new business model.
Raising a Glass to Duralex’s Cooperative Future
The aim is to reduce the high production costs by investing in renewable energies and to make Duralex profitable again by developing new products. To do this, the company needs to modernise its machinery and structures. It wants to build up rather than down. Duralex plans to set up more departments to make sales and marketing more professional.
The renewed attention Duralex is receiving has already boosted demand for its iconic glasses. The cooperative aims to restore profitability within the next five years.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast / Justus Hartmann as the original source/author and set a link to this article on TheBetter.news. https://thebetter.news/duralex-cooperative/

The rights to the content remain with the original publisher. Läs mer…

“No One Pays Less Tax Than Billionaires” – Renowned Economist Zucman Calls for a Global Wealth Tax

Publicerad denFörfattareKontrast.at

The richest people pay the least taxes. What sounds like a story from the Middle Ages is a reality in 2024. We spoke with renowned economist Gabriel Zucman about why this is a problem and what we can do about it. His solution: a global wealth tax.
Interviewer: Can you explain the impact of tax evasion by multinationals and the super-rich on broader society?
Gabriel Zucman: The main impact is that it increases inequality. When the richest people avoid taxes, the rest of the population has to pay more. This allows the super-rich to accumulate even more wealth, which makes inequality worse. That’s why it’s so important to fight tax evasion.
Corporations and the super-rich use tax havens like the Cayman Islands to hide their money from tax authorities (source: unsplash)
Interviewer: If we could reduce tax evasion, what benefits would there be for the average citizen?
Gabriel Zucman: Firstly, if the richest people and multinational companies paid their fair share of taxes, the rest of us could see lower taxes on income and consumption, like VAT. Secondly, more tax revenue could go to essential public services like education, healthcare, and infrastructure. These are key drivers of economic growth. Overall, this would boost prosperity for everyone.
Interviewer: What specific actions can Austria and the EU take to combat tax evasion by the super-rich and multinational firms?
Gabriel Zucman: There’s a common belief that individual countries can’t effectively address tax evasion, and that these issues can only be solved globally. This is not true. Any country can take action, like imposing a minimum tax on multinational firms. While there’s a global minimum tax of 15%, Austria could increase it to 20% or 25%. Läs mer…

Lula da Silva keeps his promise: Amazon deforestation reduced by 64%

Publicerad denFörfattareKontrast.at

The deforestation of the Amazon rainforest has been in action for years, risking the collapse of the unique ecosystem. But the election of Lula da Silva as president in early 2023 brought hope. He announced that he would put an end to the deforestation of the Amazon. He seems to be keeping his promise as, compared to November 2022, deforestation in the Amazon fell by 64% in November 2023.
The Amazon rainforest is one of the largest carbon reservoirs on earth. This makes it particularly important in the fight against climate change. Despite this, illegal deforestation persists. This was especially evident under the right-wing nationalist ex-president Jair Bolsonaro. During his time in office, rainforest deforestation increased by around 75%.
The current president, Lula da Silva, promised to stop deforestation when he took office – and it looks like Silva is keeping his promise. Compared to the previous year, deforestation fell by 64% in November 2023. According to the Brazilian Space Agency (INPE), around 200 square kilometres were destroyed. This is the smallest area since the evaluations began. It is also the first time since 2018 that less than 10,000 square kilometres have been deforested in one year.
“Brazil is ready to resume its role in the fight against the climate crisis and protect all ecosystems, especially the Amazon. Our government once managed to reduce forest destruction by 80 per cent. Now let’s all fight together for zero deforestation!”
FIRST SUCCESSES AFTER JUST 6 MONTHS: RAINFOREST DEFORESTATION DOWN BY 33.6 PER CENT
After six months in office, the BBC report initial successes in the fight against deforestation. Compared to the first half of the previous year, deforestation has been reduced by 33.6%. In June 2023, 41% less forest was destroyed than in the previous year. Brazilian Environment Minister Marina Silva attributes this to Lula’s successful environmental policy.
LULA’S POTENTIAL TO REDUCE DEFORESTATION BY 89%
Lula’s goal of ending deforestation by 2030 is a major challenge. This is because deforestation reached alarming proportions under his predecessor Jair Bolsonaro. The new conservation plan published by President Lula at the beginning of June 2023 aims to achieve this goal. Among other things, it provides for the confiscation of half of all illegally used land within protected areas, as well as higher penalties for illegal deforestation.
The Brazilian president also calls on other countries – especially the rich West – to contribute financially to saving the “green lungs of the Earth” in order to combat the global climate crisis.
A study attests that Lula’s plans have the potential to actually reduce deforestation in the Amazon by 89%. In any case, Lula will not have an easy time of it. The left-wing president still faces a conservative majority in parliament.
UNDER BOLSONARO, THE AMAZON SHRANK BY MORE THAN TWICE THE AREA OF VIENNA – PER MONTH
This is sorely needed, as the Amazon has been badly affected in recent years. When Lula first moved into the presidential palace in 2003, he launched an ambitious programme to save the rainforest. He and his successor Dilma Rousseff, who like Lula comes from Brazil’s left-wing Workers’ Party, succeeded in reducing deforestation by 80% to a historic low. But when Bolsonaro came to power in 2019, Brazil made a U-turn in its environmental policy.
Bolsonaro willingly granted concessions to allow corporations to clear the rainforest for soya and palm oil cultivation, cattle breeding and mining. Illegally cleared areas were legalised by Bolsonaro and forest fires were only half-heartedly combated. Deforestation increased sharply by 70 per cent under his government.
FOR THE FIRST TIME, THE AMAZON EMITS MORE CO₂ THAN IT CAN CAPTURE
Under Bolsonaro, the Amazon’s carbon footprint has turned around. For the first time, it is emitting more CO2 than it can bind. This was revealed in a study by researchers from the French National Institute for Agronomic Research. The scientists mainly analysed satellite data documenting the plant biomass in the rainforest and its deforestation. The result: the Amazon basin released around 16.6 billion tonnes of CO₂ into the environment, but only absorbed around 13.9 tonnes. This 2.7 billion tonne difference is roughly Austria’s consumption for 35 years.
[embedded content]
WITHOUT A WELL-PRESERVED AMAZON RAINFOREST, THE ENTIRE ECOSYSTEM COULD COLLAPSE
The Amazon currently has a perfectly functioning water cycle. Inland regions actually have too little rainfall for a tropical rainforest. But the trees suck the groundwater upwards, it evaporates and rains down again over the huge forest area. This cycle could be permanently disrupted by further deforestation. The rainforest would slowly die off, turn into a savannah and change the climate around the world.
This process would release as much CO2 as the entire world consumes in seven years. The unique ecosystem, which is home to 10% of all species, would be irretrievably lost and with it the CO2-binding effect of the rainforest. Scientists assume that this tipping point is reached at a deforestation rate of 20 to 25%. We are currently at 18%.
ANTI-DEFORESTATION RAIDS AFTER TAKING OFFICE
Just a few days after taking office, Lula’s government took action and carried out controls in the rainforest against illegal deforestation. As reported by Reuters, checks were carried out in areas that are all within the Cachoeira Seca indigenous reserve, where deforestation is strictly prohibited.
While deforestation is decreasing, the number of fires continues to rise, as satellite monitoring shows. Whether this is due to natural causes or arson cannot be determined.
[embedded content]
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast / Marco Pühringer as the original source/author and set a link to this article on Scoop.me. https://thebetter.news/amazon-deforestation-reduced/

The rights to the content remain with the original publisher. Läs mer…

Finland is successfully fighting homelessness – despite new political developments

Publicerad denFörfattareKontrast.at

No more homelessness – a goal that sounds like utopian fiction may become reality soon. The “Housing First” concept in Finland, supported by NGOs like the Y-Foundation, is aiming towards the end of homelessness in 2027. In a new interview, Juha Kahila, Head of International Affairs at the Y-Foundation, talks about the implementation of “Housing First”, new developments in politics and his hopes for the future.
The “Housing First” project in Finland is still successfully reducing homelessness. Those affected by homelessness receive an apartment and additional support without any preconditions. The result: The number of people without housing is decreasing steadily since the 80s. In 2022, there were 3,686 homeless people in Finland, which is 262 less than in 2021. The aim is to end homelessness in Finland by 2027. We’ve already reported on this in a previous article.
[embedded content]
New developments on “Housing First” in Finland
A key stakeholder in the Finnish fight against homelessness is the Y-Foundation. The NGO has been providing housing for the homeless since 1985. It is now one of the sponsors of the “Housing First” policy in the country. It organizes housing and is the fourth largest landlord in Finland. Today, it manages 19,000 apartments throughout Finland. 7,000 of these apartments are specifically for homeless people or people who are about to become homeless.
In a recent interview Juha Kahila who works as Coordinator and Lead Coordinator of the National Housing First Development Network at the Y-Foundation is talking about the process of “Housing First”. He gives detailed information about the financial benefits of the housing project and explains the role of the Finnish government in the realization of this concept.
A new development is the election of a conservative government in 2023. Kahila believes that the success of “Housing First” is depending on whether the new government is cutting certain social benefits. But he is still hopeful that the goal of ending homelessness can be achieved. Furthermore, he thinks that organizations and political decision-makers in other countries can be inspired by the project and that this will help the countries greatly in the long term.
Interview with Juha Kahila from the Y-Foundation about the implementation of “Housing First” in Finland
Kontrast.at spoke to Juha Kahila about the successful Finnish concept and the Y-Foundation. He has been involved in helping the homeless for over 10 years and worked at the Finnish Youth Housing Association services (NALPA) before becoming its CEO. He later moved to the Y-Foundation, where he now works as Head of International Affairs. You can read the interview in German here.
Juha Kahila (Photo: Juha Kahila:Twitter)
Mr. Kahila, what does the process of the allocation of housing look like? How does a person approach you and how long does it take to get an apartment?
Juha Kahila: First of all, before a person becomes homeless, most people have already tried a lot to prevent this. If someone still loses their apartment, they can consider – together with one of our social workers – what the best housing solution and form of support is. In other words, whether it should be a single apartment with occasional support or a “Housing First” unit, i.e. an apartment in a “Housing First” complex where help is available around the clock.
At the moment, we can provide both housing and support very quickly. Only if someone wants to live in a specific “Housing First” unit they may have to wait longer for an apartment. But many people want to wait in temporary accommodation anyway and that is always possible.
Social benefits begin to flow immediately. Depending on the person’s situation, we also consider appropriate job opportunities. For example, the “Housing First” units offer low-threshold employment provision themselves.
The Y-Foundation always works together with other agencies. We provide the housing. Support, advice, social services and other services are then provided by the welfare districts and other organizations.
Common rooms – and even a sauna: This is what the “Housing First” houses look like
What do these apartments or houses look like? Are they spread throughout the city?
Juha Kahila: The apartments are mainly quite ordinary. 80 percent of the apartments are scattered around the city. The rest are in “Housing First” units, each with around 33 to 100 apartments in one building and support services on the ground floor. The apartments are equipped with a fridge, oven, etc. The residents furnish the rest themselves so that they feel at home. In the “Housing First” units, there are also communal areas where people can cook, watch TV together or just meet and chat.
Housing First Unit Väinolä in Espoo, Finland. (Foto: Y-Foundation, zVg)
There are certainly people who say it is unfair that many people have to spend a large part of their income on housing, while others simply get it “for free”. What do you say to them?
Juha Kahila: The answer is that housing is a human right. If that’s not enough of an argument, we explain that it actually saves money to provide housing in this way – and to avoid people having to sleep in emergency accommodation or on the street. We explain that the city is also safer for everyone if we really take care of everyone.
Besides, nothing is given away for free, people pay rent for their apartments. Of course, in the early stages most of them pay their rent through various social benefits. But a permanent home gives them the chance to contribute more again.
You and the Y-Foundation say that it is cheaper for the state to provide housing for the homeless than to have them remain in their situation. What does this calculation look like?
Juha Kahila: It’s true that ending homelessness saves money in the long run. The reason behind this is that people don’t have to use expensive emergency services. They spend fewer nights in prison, they less often need police or legal services and so on. In Finland, we have calculated that the savings are around 15,000 euros per person per year if they get housing instead of being left in shelters or on the streets.
Once people have a home and the help they need, the resources that are needed for the other shelters and services are freed up. In addition, homeless people become taxpayers again in the long run – but we haven’t even included that in our calculation.
Overall, the effects are multifaceted. We studied this in Finland and there are studies worldwide that show the same result: It is always cheaper to house people with support than to leave them in emergency shelters or on the streets.
The initiative for “Housing First” came from the Finnish government
In Finland, there is a lot of political support for the “Housing First” approach. How did this come about – who convinced whom?
Juha Kahila: The “Housing First” model was inherently a political decision in Finland. It worked differently here than in many other countries, where organizations and other stakeholders had to explain to politicians why it makes sense. In Finland, politicians had to convince the stakeholders! With carrots and sticks, so to speak.

The politicians said: We want to change the system. If you are on board, we will help you with the renovation of the apartments. If you’re not on board, we won’t buy the accomodation you provide. So, there has been a ‘gentle push’.

However, we currently have a government that wants to cut social benefits and build less affordable housing in the future. Of course, this presents us with challenges. But we are not despairing, we are working with the tools we have.
What about other countries: Do NGOs or political representatives come to you to learn from your experience with “Housing First”?
Juha Kahila: Yes, we get several hundred visitors every year and many of them are political decision-makers: Ministers, mayors and EU decision-makers. In addition, many groups come and get inspiration for their own work.
Do you know of any comparable international projects?
Juha Kahila: There is currently great work on this in Denmark and Austria and I believe that this will benefit the countries greatly in the long term.
No one should be homeless by 2027 – Helsinki wants to achieve this goal by 2025
The Finnish government wants to eliminate homelessness completely by 2027. Will that work out?
Juha Kahila: That depends on the decisions of the current government. If not all the cuts are implemented, I firmly believe that it will be possible to end homelessness by the end of 2027.
Helsinki has an even more ambitious goal: the city wants to end homelessness by the end of 2025. They also have an excellent program, so this goal can also be achieved.
Are there also criticisms of “Housing First” and if so, from whom?
Juha Kahila: Sometimes, yes. Mostly from people who think that “Housing First” is only about housing and who don’t realize that other forms of support are an essential part of the model. Of course, we all need to do a better job in the future to reduce these prejudices.
What motivates you personally to work at the Y-Foundation?
Juha Kahila: The foundation really wants to change the world and is taking concrete measures to do so. Reducing homelessness worldwide is a goal that I can easily and happily support. We want to do everything we can to ensure that one day everyone has a home.
Is there a story of a person that you particularly remember and would like to share?
Juha Kahila: I used to be a social worker and worked with a young man for several years. At some point, he no longer needed support and was ready to live independently. This fall, after several years, he suddenly called to let me know that he had become a father and that he really wanted to tell me about it. The thought of that always makes me smile.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast.at / Kathrin Glösel as the original source/author and set a link to this article on Scoop.me. https://thebetter.news/interview-juha-kahila-housing-first-finnland/

The rights to the content remain with the original publisher. Läs mer…

Historic decision forces corporations to pay minimum of 15% tax globally

Publicerad denFörfattareKontrast.at

Multinational corporations such as Amazon, Facebook and Apple will now have to pay a minimum global tax of 15%. Even hiding their profits in tax havens won’t help. They will have to pay tax where they generate their profits, not where they produce or where they have their fictitious headquarters. This has been agreed by 138 countries after years of negotiation. This global tax is now coming into force – a “reform of the century” on the road to fair taxation.
OECD countries and the G20 nations have been negotiating global tax justice for more than ten years. In 2021, 138 of the 141 countries agreed on a two-pillar reform; a minimum tax rate of 15% and a tax shift away from the place of production to the place where profits are made. The regulation will come into force in January 2024.
The basic idea is simple. If profits in tax havens are taxed at a higher rate, it pays less for companies to shift their profits there. This won’t only effect stereotypical tax havens such as the Caribbean islands, where there is often no corporation tax at all. Tax havens within the EU, such as Ireland with 12.5% corporation tax or Hungary with 9%, are also set to be hit.
“The principle of paying taxes where profits are generated is gaining acceptance and a common tax rate of 15 per cent puts a stop to destructive downward tax competition,” says Evelyn Regner. The MEP (Social Democratic Party of Austria) has been campaigning for fairer taxation of corporations at the European level for years.
Despite criticism that China and the USA are not on board, and that a global tax rate of 15% is too low, there has never been a comparable regulation before.
“For the first time in the history of taxation, states are being given the right to tax profits generated in other states according to agreed rules,” write tax experts Prof Dr Deborah Schanz and Dr Ulrike Schramm.

A MINIMUM TAX RATE OF 15 % COULD BRING IN AN ADDITIONAL 220 BILLION DOLLARS
The minimum tax rate will apply to all groups with an annual turnover of more than 750 million euros – regardless of whether the parent company or only one subsidiary is based in an EU member state. This affects around 7,000 to 8,000 companies worldwide and, according to OECD calculations, is likely to generate around 200 billion dollars in additional taxes.
For Austria, the tax office is expecting 100 million euros in additional revenue from 2026. According to economist and head of the tax department at the Vienna Chamber of Labour, Dominik Bernhofer, this could even amount to 200 to 300 million euros per year. In the long term, it could be even more, as there will be less profit shifting and tax competition. Together with his colleague Professor Matthias Petutschnig from the University of Vienna, Bernhofer looked at 19 of the largest Austrian companies. These include the cardboard group Mayr-Melnhof, banks such as Erste Bank and Raiffeisen, Vöst and Andritz. According to them, these 19 companies alone would have to pay a good 130 million euros more per year.
AUSTRIAN PEOPLE’S PARTY REPEATEDLY OPPOSED TRANSPARENCY DIRECTIVES AT EU LEVEL
Conservative and liberal governments in Europe have been resisting tighter taxes for corporations for years. The Irish government, for example, once declared that it did not want Apple to pay any back taxes, even though this would be necessary under EU law. Austria’s Austrian People’s Party (ÖVP) finance ministers are also taking part in the blockade games. Back in 2018, the then ÖVP Finance Minister Löger blocked tax disclosure by large corporations at EU level. His predecessor Schelling – also ÖVP – also blocked the EU’s planned financial reporting obligation for large corporations in 2016.
The Austrian parliament decided in 2019 that Austria should campaign for more transparency and tax disclosure, no matter who is finance minister in the future. Despite this decision, Austria abstained from another vote at EU level in 2021, once again preventing a push for greater tax transparency. The Finance Minister at the time was Gernot Blümel (ÖVP).
This work is licensed under the Creative Common License. In case of new republication, please cite Kontrast.at/Ingo Geiger as the Source/Author and set a link to the article in English: https://thebetter.news/global-minimum-tax-rate/

The rights to the content remain with the original publisher. Läs mer…

Colombia strengthens regional economies and promotes cooperation instead of competition

Publicerad denFörfattareKontrast.at

Latin America is emerging as the place to look for alternatives to the neoliberal economic system. In Colombia, the Gustavo Petro led government has spent the last year restructuring the previously isolated sector of small businesses and cooperatives. Petro wants to shift away from this model, and into a solidarity-based system. 
The German-language Latin America news portal amerika21 reports that the establishment of a solidarity sector is intended to promote small domestic companies in Colombia. These companies include coffee producers, food vendors, artists and small businesses in the construction sector. The Colombian government has already initiated solidarity-based associations of micro-businesses in eleven regions, with a total of 33 of these projects planned. At a year-end meeting in Ibagué, 3,200 organisations celebrated the development of the solidarity economy in the country.
NEW ECONOMIC APPROACH: COOPERATION INSTEAD OF COMPETITION
The co-operatives, small businesses and small-scale farmers in the eleven regions have joined together to form so-called circuits. This means that, based on the interactions between their products and services, the businesses have also formed cross-sector networks. For example, the “Circuit for Industry, Trade and Tourism” has been created in the northern department of La Guajira and the “Circuit for Tourism and Renewable Energies” in the desert region of Tatacoa.
In the “Solidarity Network of Coffee” (Cafesol) in the department of Huila, small coffee farmers can now join forces instead of competing against each other.
PETRO WANTS TO FAVOUR COOPERATIVES FOR CONTRACTS
Last year, the government department for solidarity organisation in Colombia launched a project to create a solidarity sector. Initially, the department organised local meetings on the topic of the solidarity economy, where small-scale farmers, cooperatives and micro-enterprises could get to know each other and exchange ideas. Entrepreneurs were then trained to take on leadership positions in an educational programme. This enabled existing cooperatives to be strengthened and new cycles to be established.
President Gustavo Petro emphasises the strategic importance of the solidarity sector for the economy in Colombia:
“We want associations of small shopkeepers alongside the financial cooperatives. We want associations of small potato farmers who join forces to obtain subsidised loans so that they can begin the light industrialisation of their products.”
In addition, 30% of state contracts will no longer be carried out by large companies in future. Rather, they will be taken by joint co-operatives. This applies to projects such as road construction. The mergers of small companies therefore make it possible to complete larger contracts, which in turn generates more profit for the sector.
SOLIDARITY-BASED ECONOMY INSTEAD OF NEOLIBERALISM
The Colombian government under the presidency of Gustavo Petro shows that there are alternatives to the neoliberal model. Instead of emphasising competition, the economy is to be geared more towards a principle of solidarity by promoting the cooperative sector. The project suggests that it is possible to strengthen the local economy with the help of small businesses and cooperatives. With the development of a solidarity-based sector, small businesses can be maintained and further developed collectively.
This work is licensed under the Creative Common License. It can be republished for free, either translated or in the original language. In both cases, please cite Kontrast.at / Anna Drujan as the original source/author and set a link to this article on Scoop.me. https://thebetter.news/colombia-promotes-economic-cooperation/

The rights to the content remain with the original publisher. Läs mer…