SUBSCRIBE TO OUR FREE NEWSLETTER
Daily news & progressive opinion—funded by the people, not the corporations—delivered straight to your inbox.
5
#000000
#FFFFFF
5
#000000
#FFFFFF
un tax convention
Tax the Rich and Corporations to Close the Climate Finance Gap
New analysis by the Tax Justice Network shows that governments could raise an additional $2.6 trillion each year by applying a modest wealth tax to the richest 0.5% of households and ending corporate tax abuse.
Jul 01, 2025
As the climate crisis accelerates, global fault lines are widening. Wealthy nations are gutting aid budgets while pouring fortunes into their militaries. Their climate finance commitments ring empty, masked by claims that public funds have run dry. But the reality is different: The money is there, and a bold tax justice agenda can unlock it. Reclaiming tax sovereignty—the power to decide how wealth is taxed and where it goes—can shift resources away from billionaires and corporate giants to fund real climate solutions.
This isn’t a funding gap. It’s a sovereignty gap.
New analysis by the Tax Justice Network shows that governments could raise an additional $2.6 trillion each year by applying a modest wealth tax to the richest 0.5% of households and ending corporate tax abuse. That would be more than enough to meet global climate finance needs and still leave most countries with billions to invest in care, education, and green jobs at home.
Extreme wealth fuels climate inaction, rising debt, and inequality. In a world on fire, refusing to tax those who profit most is no longer neutral—it’s a global risk.
The climate crisis is accelerating. Floods, heatwaves, and crop failures are pushing more people into precarity. The costs of climate adaptation, mitigation, and loss and damage are projected to reach $9 trillion per year by 2030. Yet the global community is still scrambling to honor a $100 billion pledge first made over 15 years ago.
As the Bonn climate talks come to a close and attention turns to the fourth Financing for Development conference in Seville, climate finance remains a structural void that policy declarations alone cannot fill. On the road to COP30 in Belém, governments face a critical choice: Keep chasing inadequate voluntary climate finance handouts, or finally confront the rigged tax systems that let the superrich and big polluters amass obscene wealth while the planet burns.
Tax Justice Network reveals that fair taxation of extreme wealth combined with measures to curb cross-border tax abuse by multinational corporations could raise $2.6 trillion each year—enough to more than double the $1.3 trillion annual climate finance goal that United Nations member countries are aiming to reach by 2030. The real issue isn’t where new money will come from, but why governments keep letting existing public resources leak through the cracks of a broken tax system.
By applying a minimal annual wealth tax of 1.7-3.5% and reclaiming tax revenue from multinationals that underpay tax, countries could unlock additional tax revenue equivalent to 2.4%of global GDP. This is money that could be raised today if governments stopped letting it slip away through loopholes and inaction.
We modeled what countries could raise and contribute based on historic responsibility for emissions. The results are striking. If countries were to contribute to a global climate finance fund sized at $300 billion—the lower end of the current debate—then 89% of countries could cover their share and still have billions left over for public services. Even if the fund were scaled up to $1.5 trillion, 58% of countries would still contribute their fair share and have billions to spare.
Take the United States. It could raise enough additional revenue to contribute $365 billion a year toward climate finance and still be left with $412 billion to spend at home. China, India, the United Kingdom, and Brazil follow the same pattern.
This is the core message of our climate finance slider tool. Taxing extreme wealth and curbing tax abuse does not pit climate justice against development. It enables both. The interactive tool shows how much countries could raise and how much they could contribute if tax rules were rebalanced in favor of people and planet.
So why are countries still acting like climate finance is unaffordable?
The answer lies in decades of eroded tax sovereignty. Countries have signed away their taxing rights through outdated and unfair treaties, allowed wealth to flow into secrecy jurisdictions, and catered to corporate demands for tax cuts and incentives—often under conditions of debt dependence and economic coercion. In the process, governments have weakened their ability and willingness to tax those most responsible for fuelling the climate crisis.
Today, 61% of countries were found to have an “endangered” level of tax sovereignty or worse—meaning they are failing to collect tax revenue worth at least 5% f what they already raise, largely from their richest households and from multinational corporations that underpay tax. Nearly a fifth of countries (19%) fall into the “negated” category, missing out on the equivalent of 15% or more of their annual tax revenue. These are not natural constraints. They are political outcomes shaped by an unequal global financial system.
Across the Global South, the consequences are particularly acute. Many governments face impossible tradeoffs—between education and adaptation, between debt service and disaster response. As United Nations independent expert Attiya Waris has warned:
Across the Global South, care and climate responses are being sacrificed to servicing debts that dwarf the funds we need for a just transition. These sacrifices reflect an international financial order that prioritises creditor claims over human and planetary well-being.
Climate finance cannot be separated from this wider context of fiscal injustice. When governments are forced to borrow for every disaster or rely on discretionary aid pledges, they lose both agency and time. The race to build resilience becomes a race against the clock—one they cannot win without revenue.
It is time to reframe the debate. Climate finance must not rely on broken promises or voluntary pledges. It must be embedded in systems that are fair and redistributive. That means tax systems—ones that reflect both capacity to pay and responsibility for emissions.
The upcoming U.N. Tax Convention offers a once in a generation opportunity to rebalance global tax rules. If done right, it could help all countries reclaim the power to tax their richest residents and corporations fairly. It could end the era of tax havens, profit shifting, and billionaire impunity.
But we do not need to wait for negotiations to conclude. Countries can act now by introducing wealth taxes, renegotiating exploitative tax treaties, increasing transparency, and aligning fiscal policies with climate goals. These reforms are not only possible. They are popular. Polling consistently shows widespread support for taxing extreme wealth to fund public goods.
Extreme wealth fuels climate inaction, rising debt, and inequality. In a world on fire, refusing to tax those who profit most is no longer neutral—it’s a global risk.
By reclaiming tax sovereignty, governments can do what markets and private finance have failed to deliver: fund climate solutions at scale, protect the most vulnerable, and make those most responsible pay their fair share. Refusing to tax isn’t sovereignty—it’s surrender to the idea that tax is a tool for catering to the desires of the superrich, rather than a tool for protecting people’s well-being, the planet, and our collective survival.
Keep ReadingShow Less
UN Tax Convention Presents Historic 'Opportunity to Create Well-Being for All'
"At the U.N., low- and middle-income countries are in the majority, and they want a fair system where their voices are heard."
Apr 30, 2024
Tax justice advocates this week are expressing hope that delegates at a United Nations summit aimed at drafting an international tax convention will take the "once-in-a-century opportunity," as one campaigner and researcher said, to place the common good at the center of the global tax system instead of individual and corporate greed.
Representatives of U.N. member states are meeting for the Ad Hoc Committee to Draft Terms of Reference for a United Nations Framework on International Tax Cooperation, following decades of campaigning by countries in the Global South.
"It's happening," said Rebecca Riddell, policy lead for Oxfam America. "The start of historic negotiations for a fairer global tax system. We're here because of the leadership of African countries. Because of the 125 states that voted yes. And because of tireless civil society efforts."
The U.N. General Assembly passed a resolution last November calling for the meeting, with the committee required to submit "terms of reference to the General Assembly by August and a final vote on a tax convention framework expected by the end of 2025.
At the Tax Justice Network (TJN), Sergio Chaparro-Hernandez wrote last week that the negotiations are taking place with an "unprecedented level of transparency," with civil society groups able to account for the positions adopted by each state.
Another "noteworthy development" as the meeting gets underway, said Chaparro-Hernandez, is that "several of the 48 countries that had voted against Resolution 78/230 last year are now actively participating in the process."
"The European Union, for example, which voted as a bloc against the resolution last year, accepted the path set out by the resolution by stating in its initial statement at the organizational session that, 'the UN framework convention on tax cooperation can and should serve to further promote tax transparency and fair taxation,'" he added.
Along with TJN, other civil society groups including the Center for Economic and Social Rights (CESR), Eurodad, and Greenpeace are participating in the committee meeting and lobbying for a far-reaching convention framework that will "redefine the pillars of the international tax system and to make it fully inclusive, just, and effective."
"At the U.N., low- and middle-income countries are in the majority, and they want a fair system where their voices are heard," said Maria Ron Balsera, a researcher at CESR.
Under current global tax rules, the wealthiest individuals and corporations pocket $480 billion each year through the use of tax havens and other forms of tax evasion, said Greenpeace on Tuesday, "most countries just can't cover people's basic needs, nor meet their climate and biodiversity targets and commitments."
"The U.N. Tax Convention is a historical opportunity to create well-being for all, by moving decision-making power from a few rich [Organization for Economic Cooperation and Development] countries to the U.N. where every country has a vote," said the group.
Chenai Mukumba, executive director of Tax Justice Network Africa, spoke to attendees of the committee meeting about prioritizing mechanisms to crack down on tax evasion.
"While we flag the importance of this work to developing countries, we cannot overemphasize that inclusive and effective tax cooperation is important that has benefits for our global community," said Mukumba. "The international community as a whole is better off when we have more countries that have resources and capacity to provide their citizens with essential services."
On Monday, Greenpeace Africa's pan-African political strategist Fred Njehu wrote to Ramy Mohamed Youssef, chair of the U.N. Tax Convention Committee, and addressed him not only as an advocate but as "a dad, a concerned citizen, and a taxpayer."
Changing global tax rules and ensuring the wealthy pay their fair share, said Njehu would unlock "the money for everyone’s basic needs and the recovery of climate and nature."
"We both know that this is mostly because multinational corporations have been exploiting the majority of the world for way too long, and governments in some rich countries have facilitated it," said Njehu. "They're making billions on the destruction of the world and our suffering. And then, they hide their profits in tax havens. A downward spiral where wealth and power have become so concentrated as to threaten democracy, civilization, and the living world we're part of."
"Mr. Youssef, you have a big responsibility and a unique opportunity to turn things around this year," he added. "Civil society, academics, and countries that represent 80% of the world’s population are backing you and your colleagues at the U.N. Tax Convention Committee to change the global tax rules, which are critical for how the global economy works... Now we need equality, transparency and accountability. Polluters must pay and the wealthy must be taxed fairly."
Keep ReadingShow Less
Most Popular