If the average global temperature rise is to be limited in line with the 2015 Paris agreement, climate finance will need to increase to about $9 trillion a year globally by 2030, up from just under $1.3 trillion in 2021–2022. To identify ways forward, IPI hosted a virtual panel discussion on June 18th on “Mobilizing Finance for Climate, Inequality, and Sustainable Development: New Taxes and Levies.”

Countries are converging around the idea of new global taxes to fund action to address a wide variety of needs, including inequality, poverty, and climate action. Levies on shipping, fossil fuel production and subsidies, air travel, and financial transactions feature prominently in agendas to reform the international financial architecture. Barbados, France, and Kenya have launched an International Tax Task Force on climate-related levies to judge the viability of these and other options for global taxes. Brazil, in its chairmanship of the G20, has promoted the idea of a “billionaire tax” on extreme wealth.

Such ideas are hardly new, but they are newly relevant given recent progress on international tax cooperation. Since 2021, when OECD countries agreed to impose a minimum effective rate of 15% on corporate profits, 140 countries have signed on to this policy. Tax reform efforts in the UN have also picked up speed. Following a historic breakthrough at the UN General Assembly in November 2023, the UN has now started negotiations on the terms of reference for a new Framework Convention on International Tax Cooperation.

Some of the questions under discussion included:

• The Marshall Islands are on the frontlines of climate change impacts, particularly the rise of sea levels. It is also on the frontlines of efforts in the International Maritime Organization for a global levy on shipping. Why is this levy important?
• What is the International Tax Task Force’s mandate, and what do they hope to achieve?
• Global taxes and levies for climate change are not new ideas. Indeed, we’ve been talking about carbon pricing for decades. Why is this time different?
• Brazil is hosting the G20 this year and COP30 next year, so it is well-poised for leadership. What does the wealth tax mean for Brazil’s climate and development efforts, at home and abroad?
• How are International Climate Solidarity Levies (ICSLs) distinct from other global tax initiatives?

Welcoming Remarks:
Zeid Ra’ad Al Hussein, President and CEO of the International Peace Institute

Speakers:
Benito Müller, Managing Director, Oxford Climate Policy
Tina Stege, Climate Envoy for the Marshall Islands
Laura Carvalho, Global Director of Equity, Open Society Foundations, and Associate Professor of Economics, University of São Paulo
Pascal Saint-Amans, Adviser to International Tax Task Force
Michael Franczak, Research Fellow, International Peace Institute

Moderator:
Jimena Leiva Roesch, Director of Global Initiatives, International Peace Institute