Letter: NDP MP Niki Ashton calls on Liberals to Support Global Tax on Super-Rich

Why won't the Liberals do what it takes to Tax the Rich?

Dear Honourable Minister Freeland.

As the G20 meets in Brazil to discuss issues of international tax policy, and global poverty, I am writing to you as NDP Tax Fairness critic to urge you to support the wealth tax on the ultra-rich of 2% as put forward at the G20. We in the NDP are also disappointed in your government's decision to vote against the UN tax convention terms of reference in August. By taking these actions you have demonstrated for Canadians that your government is committed to protecting the fortunes of billionaires, more than it is combatting poverty. At a time when the richest billionaires on the planet pay less in tax, and wealth inequality continues to soar, it is important that governments work together to combat tax evasion and raise much-needed revenues to bolster our social safety net and healthcare system.

It is good to see that your government gave into NDP pressure and increased the capital gains tax on the richest; however, your government falls short when it comes to tackling the underlying problem. Income inequality is a global phenomenon, and according to an OXFAM study, since 2020, the five richest men globally have doubled their fortunes to $1.2 trillion CAD, while the world’s poorest 60% have become poorer, with the gap likely to increase in the coming years.[1]

Let’s not kid ourselves, your government’s track record on tax fairness is as thin as a billionaire’s tax bill.

In Canada, under your government, tax avoidance schemes cost the public over $30 billion in revenue in 2021, according to a study by Canadians for Tax Fairness.[2] Instead of funding essential services like healthcare, that money is lining the pockets of ultra-rich Liberal/Conservative donors. Is this why your government refuses the NDP call to establish a special subcommittee to study corporate tax avoidance?

It is unfortunate that your government has refused to support the wealth tax of 2% on the 3,000 richest people in the world, spearheaded by Brazil at the G20. The billionaire tax would generate $250 billion annually, which could go toward addressing poverty, climate change, and providing healthcare.[3] The UN agrees, the G20 agrees, Economists agrees to tax the rich, so why doesn’t your Liberal government?

So why, if your government believes in tax fairness, has it refused to join other progressive countries like Brazil, France, Spain, South Africa, Colombia, and the African Union in taxing billionaires? Is it because you are beholden to those same billionaires? Should Canadians take this as proof that your government is more committed to having Jeff Bezos keep his yacht than First Nation communities have clean drinking water?

Your government has a pattern of undercutting international efforts to tax the ultrarich and corporation. A report by Tax Justice Network found that Canada let multinational corporations and wealthy individuals to use their financial systems to underpay tax in other countries to the tune of $15 Billion.[4]

Canada was one of only eight wealthy countries, compared to 110 others, to vote against the UN tax convention on August 18th. The resolution, which passed despite Canada’s opposition, will serve to promote tax transparency and fair taxation by making it harder for billionaires and corporations to avoid tax. Furthermore, your office has failed to reply to our letter from March asking why you continue to oppose international tax fairness at the UN. If your government genuinely cares about tax fairness, why are you standing with ultra-rich tax cheats? Instead of supporting a strong global tax regime, Canada intervened in the negotiations, objecting to language on progressive taxation.[5]

Should Canadians take this as proof that your government is only says it is committed to progressive taxation but when given the chance goers back on its word and votes against it?

Why is it that while your government likes to celebrate its commitment to multilateralism, in practice it works to undermine international tax fairness policy? Your government cited the need to minimize “redundancy.” However, civil society organizations have highlighted that there is no risk of redundancy or duplication because there has never been a truly inclusive tax body where all countries could participate on an equal footing.[6]I want to make it clear to the billionaire class that under an NDP government, we will push for an international wealth tax and a robust international tax convention at the UN to ensure compliance. Wherever the ultra-rich hide their fortunes, we in the NDP will collect the money owed to Canadians to invest in social services, infrastructure, and healthcare. The Liberals and Conservatives may protect their billionaire buddies, but we in the NDP will protect the working class.

I look forward to your response.

Sincerely

MP Niki Ashton – NDP Critic for Tax Fairness (Churchill—Keewatinook Aski)

[1] https://www.theguardian.com/inequality/2024/jan/15/worlds-five-richest-men-double-their-money-as-poorest-get-poorer

[2] https://www.taxfairness.ca/en/resources/reports/unaccountable-how-did-canada-lose-30-billion-corporations

[3] ttps://www.g20.org/en/news/at-the-g20-brasils-proposal-to-tax-the-super-rich-may-raise-up-to-250-billion-dollars-a-year#:~:text=A%202%25%20minimum%20tax%20on,billion%20in%20revenue%20per%20year

; https://www.npr.org/2024/08/06/nx-s1-5064662/global-wealth-tax-g20-poverty-climate-change#:~:text=And%20while%202%25%20might%20not,report%20commissioned%20by%20the%20G20.

[4] https://taxjustice.net/press/countries-bash-open-door-to-historic-tax-reform-at-un/

[5] (12th meeting) Ad Hoc Committee to Draft Terms of Reference for a United Nations Framework Convention on International Tax Cooperation, 2nd Session | UN Web TV (44:28)

[6] 1723830345-ffd-collectors-edition.pdf (datocms-assets.com)