Danny McCance 17 Jul 2017 03:58pm

Trump tax reforms to increase US inequality

Tax reforms proposed by the Trump administration would push the United States below Greece in terms of wealth inequality

It has fallen six places in the newly published Commitment to Reducing Inequality (CRI) index, and 33 places in terms of tax policy specific ratings.

The analysis of Trump's tax proposals suggest that the US, historically the world’s richest nation, would slip below countries such as Greece, Spain and Argentina, all of which are currently or recently suffering from economic crises, the Guardian reported, using figures from Oxfam.

The cuts would force the US even lower among its 34 OECD counterparts, already shockingly low at 21st place.

The country’s ranking among the top 47 high-income countries is currently at 22nd.

The Oxfam figures suggest that the effective tax rate for corporation tax in US, at 25.9%, is considerably lower than the statutory tax rates. It revealed between 2009 and 2015 the top 50 countries in the US held $1.4trn in 1,751 subsidiaries in offshore tax havens.

In terms of specific tax policy South Africa was found the have the most "progressive structure and incidence of tax", with Sweden being ranked number one in the CRI index.

At the opposite end of the scale Albania was ranked the lowest in terms of tax policy, while Nigeria was ranked at the bottom of the index.

Oxfam revealed that the eight richest individuals own the same wealth of the lowest 3.5 billion people on the earth, and while 50% of the wealth since the turn of the century has gone to the top 1%, the poorest half of the population has received just 1%.

To play a part in combating this, Oxfam combined forces with Development Finance International to compile the CRI index, the first of it’s kind to try and stratify the commitments made by leaders of 192 countries to reduce inequality.

The index is audited by the European Commission's Joint Research Centre to ensure the data is robust.