Inequality has reached unprecedented levels, with more than 70% of the global population living in countries where the wealth gap is growing, according to a new UN report.
Rising inequalities are benefiting the wealthiest. Top income tax rates have fallen in all countries, which have made tax systems less progressive. In wealthier countries, the top income-tax rates have dropped from 66% in 1981 to 43% in 2018.
Social and economic disparities have soared even in countries such as Argentina, Brazil and Mexico, where inequality had been falling in recent decades, found the World Social Report.
The income gap has been exacerbated by the climate crisis. The report estimates that the gap between the richest and poorest 10% of the global population is 25% larger than it would be in a world without global warming.
If nothing is done to address the problem, the prosperity and development of millions of people could be damaged.
“If we don’t act now, the entrenched inequalities that are already there will worsen,” said Elliott Harris, chief economist and assistant secretary general for economic development in the UN Department of Economic and Social Affairs.