Brazil’s proposal for a global agreement to tax the super-rich sparked disagreement at a meeting of G20 finance ministers in Rio de Janeiro on Thursday, with Washington rejecting the need for an international agreement on the issue.

The initiative, discussed at an afternoon meeting, is one of the top priorities of leftist Brazilian President Luiz Inácio Lula da Silva, who this year chairs the G20, a group of the world’s largest economies, the European Union and the African Union.

Even before the talks began, US Treasury Secretary Janet Yellen dampened the mood by saying that there was no need for a global agreement to tax billionaires.

“Tax policy is difficult to coordinate globally,” she told journalists. “We believe that all countries should ensure that their tax systems are fair and progressive.”

However, those supporting the plan viewed its inclusion on the agenda as an important first step.

After the meeting, Brazil’s Economy Minister Fernando Haddad expressed his confidence in the initiative and said a final declaration to be published on Friday would be a “first step”.

This communiqué takes up the “Brazilian proposal to look at international taxation not only from the perspective of companies, but also from the perspective of individuals, the so-called super-rich”.

According to a draft statement seen by AFP, G20 members would “seek to work cooperatively to ensure that ultra-high-net-worth individuals are taxed effectively.”

“Wealth and income inequalities undermine economic growth and social cohesion and exacerbate social vulnerability,” the text of the draft states.

It added that international cooperation could help promote “fair and progressive tax policies”, without mentioning taxes negotiated at the internationally level.

A participant at the meeting, who wished to remain anonymous, told AFP: “There is no consensus today on the introduction of a global tax on the capital of multimillionaires.”

“The idea is to put the issue on the agenda and discuss first steps.”

– ‘Irrelevant’ –

Brazil’s push for a global agreement to tax the richest of the rich is supported by France, Spain, South Africa, Colombia and the African Union.

“A few individuals control more resources than entire countries,” Lula said on Wednesday as he unveiled an initiative to combat world hunger, another project high on his G20 agenda.

Haddad told local media on Wednesday that taxing billionaires would help finance the fight against hunger.

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According to a study published on Thursday by the non-governmental organization Oxfam, global inequality has continued to increase in recent years.

The richest one percent of the world has earned more than $40 trillion in a decade, but taxes are at a “historically” low level, the study says.

French economist Gabriel Zucman, who advises the G20 on tax issues, estimates that the tax rate for billionaires is 0.3 percent of their wealth.

“For the first time in history, there is now a consensus among G20 countries that the way we tax the super-rich needs to be determined and a commitment to work together on this. This is an important step in the right direction,” he told AFP.

Washington is not the only skeptic.

On the eve of the G20 summit, the German Finance Ministry stated that it considered the idea of ​​a minimum tax on wealth to be “irrelevant”.

– Disagreement over Ukraine and Gaza –

The finance ministers’ meeting in Rio began with a session on the global economy, as inflation eases in many parts of the world after a rise fuelled by the war in Ukraine and other factors.

On Friday, ministers will discuss financing the climate transition and the debt issue at their last meeting before the G20 summit on 18 and 19 November.

Founded in 1999, the Group of 20 brings together 19 of the world’s largest economic powers as well as the European Union and the African Union.

Originally focused on global economic issues, the organization is now increasingly addressing other pressing challenges – even if member states do not always agree on what should be on the agenda.

A statement by the Brazilian presidency said member states disagreed on whether crises such as the conflicts in Ukraine and the Gaza Strip should be a topic of discussion at the G20.

Due to differences of opinion within the G20, of which Russia is a member, the drafting of a joint communiqué as a result of the meetings is a challenge.

No such declaration was made at the last meeting of finance ministers in Sao Paulo.

Brazil hopes to publish three texts after the meeting, said Tatiana Rosito, a senior official in the country’s economy ministry.

In addition to a joint final communiqué, this will also include a document on “international cooperation in tax matters” and a separate communiqué from Brazil on geopolitical crises.

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