Bonn Climate Conference: G77 group suggests rich nations tax tech, fashion and defence firms for climate finance in Global South
Global experts have assembled in Germany for the ongoing Bonn Climate Change Conference 2024. During the discussions, the G77+China group said rich governments could raise $1.1 trillion a year, needed by poorer countries for climate action.
Developing countries seek rich nations to give them hundreds of billions of dollars to curb emissions and adapt to climate change, suggesting this could be raised by taxing defence, technology and fashion companies, besides financial transactions too.
Seen by Climate Home, an unpublished position paper by the umbrella group for 134 developing countries maintains that rich nations “only” need to spend 0.8% of their GDP per year to raise $441 billion – mobilising enough private finance to reach $1.1 trillion annually.
Taxing tech, fashion and defence firms for climate
The paper highlights that 0.8% of GDP is much less than the 6.9% of GDP developing nations are currently required to spend paying interest on their debt. It argues that the matter in question is not if the resources exist, it is if there is political motivation to prioritise climate action.
Developing countries stress that
1. Financial transaction tax could help raise about $240 billion a year over 10 years through a 0.5% tax on trades, 0.1% on bonds and 0.005% on derivatives “only for Wall Street”.
2. 5% tax on the annual sales of the top 7 technology firms could raise about $57 billion a year. Those could include the ‘Big Tech’ firms like Apple, Amazon and Google.
3. 5% tax on the annual sales of the roughly 80 top fashion companies in developed countries, including Dior, Nike and Louis Vuitton, could raise about $34 billion a year.
4. 5% tax on the annual sales of the top 80 defence firms in developed countries, including Lockheed Martin and Boeing, could help raise around $21 billion annually.
Read More: Can Bonn Climate Conference 2024 set the stage for better decisions at COP29 Baku?
