Business & Economy

Piketty: More tax transparency needed to reduce inequality in Latin America

By Jorge Gil Angel

Cartagena, Colombia, Feb 3 (EFE).- Latin American countries need more transparency in their tax systems and public spending to accelerate the movement toward greater equality, French economist Thomas Piketty said in an interview with Efe.

“We need to involve citizens. We need to have more transparency about both the tax system, the public spending … so that citizens can actually see if we are moving in the right direction,” said Piketty, who participated late last month in Hay Festival Cartagena de Indias.

“More transparency so citizens can appropriate for themselves and check whether progress has been made or not,” the author of the award-winning, best-selling book “Capital in the Twenty-First Century” added.

In that regard, he said he is encouraged by the rise to power of new leftist leaders such as Chile’s Gabriel Boric in Latin America, a region that he noted has persistently high levels of inequality.

He added that he hopes those leaders take concrete actions to address this scourge and do not just pay lip service to the problem.

Referring to the United States, the global expert on wealth and income inequality said that country is better off with Joe Biden as president as opposed to Donald Trump, although he said his administration’s agenda is being held back by lawmakers from his own Democratic Party who receive major financial backing from Republican donors.

“I think there is a majority of US public opinion that would actually want a tax on billionaires,” said Piketty, who has called in the past for a wealth tax on millionaires and billionaires and said the latter should be taxed out of existence.

For that reason, he said he hopes a figure from the “left side of the Democratic Party” will be able to “convince popular voters and lower-class electorate” that the party “is ready to change their attitude toward big business and toward normal people.”

Piketty also talked about current tensions between Washington and Moscow over Ukraine.

Russia, which wants a NATO commitment to pull troops from former Soviet republics in Eastern Europe and assurances that Ukraine will never be admitted to the alliance (demands rejected by the US and its allies), has amassed more than 100,000 Russian troops – along with tanks and advanced weaponry – on its border with Ukraine.

Russia has said it has no plans to attack Ukraine, but the US has threatened to impose severe economic sanctions on Moscow if it goes through with an invasion.

“We have to think of new ways to have economic sanctions against countries. I think the sanctions should be mostly against the elite and against oligarchs and not (against ordinary) people,” he said.

“I think we could have an impact on the situation (that is) much better than by having trade sanctions which are going to hurt full population, or by having a military escalation which of course is not going to work.”

Piketty also added that little progress has been made in the area of gender inequality, noting that women’s global labor income share was around 31 percent in 1990 and has grown to just 34 percent today.

He noted that there are entire occupational sectors that have traditionally been occupied by women, such as retail sales, cleaning services and elderly patient care, and which have low salaries compared to traditionally male-dominated sectors such as industrial manufacturing.

The famed economist said the solution is to pass laws that guarantee better salaries and better organization of women’s working time. EFE


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