Billionaires afford world vaccination pandemic earned money pay, according to Oxfam study - Billionaires around the world increased their wealth by about 5.5 trillion dollars (about 4.2 trillion euros) during the pandemic alone. A 99% tax on those profits could help vaccinate the whole world.

This is indicated by a new report by Oxfam, the Fight Inequality Alliance, the Institute for Policy Studies and Patriotic Millionaires.

The analysis examines the impact of a possible one-time tax on the profits of billionaires during the pandemic, using real-time data from Forbes to track net worth. The report concludes that the world's 2,690 billionaires have increased their fortunes dramatically, and their accumulated wealth has grown more since March 2020 than in the previous 15 years.

That adds to an accumulated net worth of $ 13.5 trillion (€11.5 billion), which marks an increase of $ 5.5 trillion, or almost 69%, since the pandemic first hit, when they had $ 8 trillion (around € 6.8 billion).

"The wealth of billionaires is not earned. Billionaires benefit from the hard work and pain of workers. It's their money ‘earned' from your sweat, and it's time that sweat started to pay off,” Njoki Njehu, pan-African coordinator of the Fight Inequality Alliance, said in a statement.

Billionaires afford world vaccination pandemic earned money pay

According to the report, this one-time 99% tax would raise $ 5.4 trillion (about 4.6 billion euros), while billionaires would continue to withhold $ 55 billion in profits made during the pandemic.

The authors estimate that the cost of vaccination is 7 dollars per dose, just under 6 euros. This means that the total cost of vaccinating everyone would be $ 70 billion (nearly 60 billion euros), a relatively small fraction of the total profits made by those billionaires during the pandemic.

Currently, according to Our World In Data, only 1.2 per cent of people in disadvantaged countries have received at least one dose of vaccine. The journal Nature reports that it will take until 2023 for the poorest countries to be vaccinated at the current projected rate.

Billionaires afford world vaccination pandemic earned money pay

The report proposes that the rest of the money raised by a wealth tax should go to unemployed workers. The International Labour Organization has found in a report that there are 220 million unemployed people worldwide. According to the analysis, it would cost 4.4 trillion dollars (about 3.7 billion euros) to give everyone 20,000 dollars, an amount of money that would be left over after the global vaccination.

Taxation of the wealthiest members of society has been suggested as a method of addressing pandemic inequality.

Billionaires afford world vaccination pandemic earned money pay

In April, the International Monetary Fund endorsed taxes on the rich and corporations as an option to help the economic recovery from the pandemic. Argentina went one step further by enacting its own wealth tax, which is applied only once to 0.8% of its population. The money from that tax-which raised $ 2.4 billion— will go to housing, public health and other sectors affected by the pandemic.

” It's time to take a significant blow to these inequalities, "Chuck Collins, director of the Institute for Policy Studies' inequality and common good program, told. “You cannot have a more extreme example of the harms of billionaires ' excess wealth in the face of the plight of ordinary people than what we are seeing right now. And people know it. So I think these measures to the big fortunes to reverse inequality would have broad public support."

Billionaires afford world vaccination pandemic earned money pay

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How to avoid double taxation if you invest abroad

Investing in Apple, Amazon, or any GAFAM company is the order of the day. International securities populate the stock portfolios of value investors, growth and, of course, dividend investors.

If you already invest in foreign shares or are considering doing so, you should not lose sight of the double taxation that can be applied on these shares and their dividends.

Double taxation is very easy to understand: it involves paying taxes twice for the same thing.

In the case of shares and their dividends, it involves paying taxes in the country of origin and in the country of destination. With the example of the GAFAM, you will first pay taxes in the United States and then in Spain when making the income tax return.

And is that, these shares are taxed in personal income tax like any other title, even if they are in an international broker. What you tax differently are your dividends. That is where double taxation is applied, first in the country of origin and then in Spain.

As an investor you can do nothing to avoid double taxation of entry. The Tax Agency will be in charge of protecting your interests in this case through the double taxation agreements.

These agreements serve precisely to prevent you from having to pay twice for the same thing. Spain currently has agreements of this type with more than 90 countries.

In the case of shares and their dividends, these agreements allow you to recover what you have been held with the limit established by the agreement. In general, the limit for withholding tax is 15 per cent. This is the maximum percentage you can recover for double taxation on shares.

What if the retention is higher? When this happens you will have to ask the country where the company is based to reimburse you that excess.

What if there is no convention to avoid double taxation? With these countries the way to recover these income TAX withholdings is much more complicated. The most common is that you can recover the money as long as you have kept the investment in the company for more than 12 months. The handicap is that you will only receive the smallest of the amounts between what you have been withheld up to a maximum of 19% and the result of applying the effective average rate of the tax determined by the dividends minus the expenses multiplied by the taxable base between the income of the tax period.

These withheld amounts are recovered at the time of filing.

When filling in the personal income tax in box 0029 you must indicate the gross amount of the dividends you have collected. Don't forget to also add the deductible expenses for your investments such as administration and custody expenses.

Then you must tick box 0588 under "international double taxation deductions". In this box you must put the figure that you have been retained outside Spain up to a maximum of 15% in general.

By doing so, the Treasury will return to you in the income that withholding of the dividends of foreign shares.

However, this does not mean that you will collect that money. In fact, you usually have to pay taxes on dividends and the difference between the withholding of the country of origin and the Spanish.

With the refund of the withholding tax for double taxation you will recover a withholding tax of 15%, while the rate payable in Spain is 19%. In addition, when collecting those dividends in Spain, the treasury will apply a withholding tax of 19% on the net amount, not on the gross.

The following example illustrates what happens with double withholding when making rent.

You receive 100 euros in dividends from abroad and the withholding tax of 15% or 15 euros is applied.

Then comes the withholding at origin, in Spain. This withholding is 19% and is applied on the net amount you charge. That is, about 100 euros less the taxes you have already paid in the country of origin. In total, it amounts to 16.15 euros.

In your pocket will arrive 68.75 euros. When you make the rent you will recover 15 euros for double taxation. However, you will now pay taxes on the total dividends collected: 19% on 100 euros or 19 euros.

As you have only advanced 16.15 euros via withholdings, in the rent you will have to pay the 2.85 euros that remain up to the 19 euros that you have to pay for those dividends.

This is how this double taxation works and how it affects the outcome of your income tax return.