Share of Total Income Accrued
(Including Capital Gains)
UNITED STATES: SHARE OF NATIONAL INCOME FOR THE TOP 1%
Source: World Top Incomes Database, http://g-mond.parisschoolofeconomics.eu/topincomes (Last accessed March 21, 2012)
that the surveys do not include information on rich households.
How do we know? Just look at the
income of the richest households
in any survey in any country. For
example, the 2006 household surveys in Argentina, Brazil, Mexico,
and Peru report that the average
monthly incomes of those countries’ two richest households were
equal to $14,000, $70,000, $43,000,
and $17,500 dollars, respectively. 3
Compare this to Merrill Lynch estimates that in Latin America there
are approximately 4,400 ultra-high-net-worth individuals, each with assets of at least $30 million. Assuming
these individuals on average earn
a return of 5 percent per year, they
are potentially earning $2 million
Something’s not getting reported.
So, what needs to be done to
know the income shares of the rich
in Latin America? The answer is
simple. Governments should publish the information from tax returns (without identifying anyone
by name, of course)—the same way
that all Organisation for Economic
Co-operation and Development
(OECD) member countries have been
doing for decades, except for OECD
members Chile, Mexico and Turkey.
Shouldn’t the citizens of the region be allowed to know how their
national income is distributed?
Aren’t citizens and legislators entitled to know how much each income class contributes (or should
contribute) in taxes? Shouldn’t governments be held accountable to
their commitment to transparency
in information systems?
As long as information on in-
comes and taxes paid is kept from
the public, genuine discussion on
tax reforms will be impossible. If
we do not know who bears the tax
burden today, how can we judge the
impact of any proposed tax reform?
Nora Lustig is the Samuel Z.
Stone Professor of Latin American
Economics at Tulane University.
FOR SOURCE CITATIONS SEE:
Americas Quarterly SPRING 2012