Millionaires from 13 countries petition world leaders at Davos to tackle the problem of extreme wealth as new analysis shows that the number of ultra-rich in Kenya has more than doubled in the last decade

As the World Economic Forum continues in Davos, Switzerland, over 200 millionaires from 13 countries have urged global leaders to face up to one of the world’s most neglected forms of extremism - that of concentrated wealth. In a letter entitled The Cost of Extreme Wealth, millionaires from multiple backgrounds - including business leaders old and new from tech, food, and energy companies, celebrities Mark Ruffalo and Abby Disney, as well as inheritors and investors - state, ‘the history of the last five decades is a story of wealth flowing nowhere but upwards. In the last few years, this trend has greatly accelerated...The solution is plain for all to see. You, our global representatives, have to tax us, the ultra-rich, and you have to start now.’

The letter comes as new analysis conducted by the Fight Inequality Alliance, Institute for Policy Studies, Oxfam, and the Patriotic Millionaires shows the growing level of extreme wealth in Kenya. In the last decade, the richest Kenyans with a net wealth of $5 million (Ksh615 million) and above have seen their wealth grow by 72% in real terms, and their population by 134%. The analysis shows that there are 1,890 individuals in Kenya with a net worth of $5 million (Ksh615 million) or more, with wealth totalling $39.9 billion (Ksh4.9 trillion). This also includes 130 individuals with $50 million (Ksh6.15 billion) or more with combined wealth of $18.7 billion (Ksh2.3 billion).

Globally, the analysis shows that the total number of people in the world with at least $5 million (Ksh615 million) in net wealth has grown by 52.9 percent over the last decade and individuals with a net wealth of $50 million (Ksh6.15 billion) or more, have enjoyed similar growth levels. Meanwhile, the global billionaire class has more than doubled their wealth, and their population has skyrocketed at a similar rate. Between them, the world’s
billionaires added more than $5.9 trillion (Ksh726 trillion) to their wealth in the last ten years.

In Kenya, the super-rich are increasingly amassing enormous wealth even as most Kenyans grapple with the impact of covid-19 pandemic, rocketing prices of basic items, the draught situation and unemployment. Oxfam’s analysis shows that the richest four Kenyans with a combined net wealth of $2.71 billion (Ksh333 billion) own more wealth than 22 million Kenyans (bottom 40%).
“The analysis shows that the increasing extreme wealth of the rich and increasing extreme poverty of the poor driven by low taxes on the richest Kenyans by virtue of tax breaks, incentives, avoidance and evasion, alongside unfairly higher taxes on poorest Kenyan’s, directly through income tax and indirectly through taxes on fuel, food and basic commodities, is a social ill and a shame.” Dr. John Kitui, Oxfam in Kenya Country Director, said.

Support for action on extreme wealth from this growing number of millionaires comes as a poll of 135 economists, from 40 countries, shows that 71 percent think there is scope for raising taxes on the rich in their country over the coming five years. A similar share (71 percent) responded that rising inequality in their country is partly caused by falling taxes on the rich, and 73 percent think that the rich pay fewer taxes in proportion to their income than the average citizen in their country.

The paper also highlights the extensive public attitude polling on inequality and tax, conducted in G20 countries over the last six years by multiple agencies, all of which show an overwhelming public support for taxing the rich.
Marlene Engelhorn, co-founder of taxmenow, author, and millionaire signatory on the letter said, “The whole world – economists, publics, and millionaires alike – can see the solution that is staring us all right in the face: we have to tax the ultra-rich. If we care about the safety of democracy, about our communities, and our planet we must get this done. And yet our decision-makers either don’t have the gumption or don’t feel the need to listen to all these voices. It begs the question, ‘What, or who, is stopping them?’”

The introduction of annual wealth taxes is argued as a key solution to addressing the wealth extreme. According to the report analysis, if a net wealth tax was introduced in Kenya at rate of 2% on the millionaires worth above $5 million (Ksh615 million) and 3% on those with wealth above $50 million (Ksh6.15 billion) the revenue potential could be $731 million (Ksh89.9 billion) a year. This would be enough to hire 100,000 teachers in public primary and secondary schools and more than 38, 000 nurses to close the teachers and nurses’ gap in the education and health sectors.

Globally, introducing a net wealth tax starting at 2 percent annually for those with more than $5 million, 3 percent for those with over $50 million, and rising to 5 percent annually for billionaires, the revenue potential could be $1.7 trillion (Ksh209 trillion) a year.

The letter will be handed over in person by Patriotic Millionaires member, Phil White, and Marlene Engelhorn of taxmenow. It was circulated by Patriotic Millionaires and PMUK, Tax Me Now, Millionaires for Humanity, Fight Inequality Alliance, Institute for Policy Studies, and Oxfam, and reminds political leaders: ‘Extremes are unsustainable, often dangerous, and rarely tolerated for long. So why, in this age of multiple crises, do you continue to tolerate extreme wealth?’
ENDS//