The richest people in New Zealand continue to get richer, with the collective wealth of the country's two billionaires increasing by NZ$1.1 billion at the same time as the poorest 50 percent of the population decreased their wealth by NZ$1.3 billion. The growing gap between the rich and poor was illustrated in an Oxfam report entitled 'Public Good or Private Wealth', which the non-profit organisation release each year as a way to highlight growing wealth inequality during the World Economic Forum.
Globally, the wealth of the world's billionaires increased by US$900 billion in 2018, at the staggering rate of US$2.5 billion a day. Over the last decade since the global financial crisis, the number of billionaires across the world has almost doubled. Amazon founder Jeff Bezos is the richest man in the world with a fortune of $US112 billion, with 43 billionaires living in Australia and two in New Zealand.
As the two richest individuals in the country, the New Zealand section of the Oxfam report concentrated on the wealth of Graeme Hart and Richard Chandler compared to the wealth of the entire nation. Hart is worth US$10.1 billion, while Chandler has a much smaller US$2.1 billion fortune. While New Zealanders have always applauded success and continue to tax wealth at one of the lowest levels in the OECD, the top end of town seems to be enjoying unprecedented gains while everyday Kiwis are struggling with low wage growth, high property prices, and rising household debt.
According to the Oxfam report, the top 5 percent in New Zealand now has more wealth than the bottom 90 percent combined, at 45 percent compared to 42 percent of all wealth. In an even more staggering statistic, the top 1 percent of the population has 25 percent of all the wealth in New Zealand. This mostly mirrors what's happening around the world, with billionaire wealth increased by 12 percent from 2017 at the same time as poorest half of the global population decreased it's wealth by 11 percent.
According to Oxfam's executive director Rachael Le Mesurier, this growing disparity can be addressed by focusing on taxing wealth in New Zealand rather than income tax on everyday Kiwis. Historically, New Zealand has taxed wealth at one of the lowest levels in the developed world: "One of the key things we can do to tackle inequality here and across the world is to tax wealth more. Our taxes pay for schools, hospitals and infrastructure ... across the world, rich multinational corporations and extremely wealthy individuals are not paying their fair share... The real concern is that there is evidence-based research that shows that there are policies that Governments can put in place to reduce this gap."
"We don't have the taxes on inheritance wealth or capital gains that many others in the OECD do. These are some of the policies that the Tax Working Group are looking at... What we've been seeing, particularly in the last four years, this gap has been getting bigger and if we see that. Wealth begets wealth, we know this and for at least a third of the billionaires they've inherited their wealth so they've started ahead of the game." said Le Mesurier, adding, "I think that should be what's worrying all New Zealanders. It's not about attacking the extremely wealthy, it's really saying it's not okay that the poor are looking backwards at the same time."
Image source: pathdoc/Shutterstock