By Abbas Nazil
Fossil fuel companies may soon be required to pay for the climate damage they cause, while the ultra-wealthy may face a global wealth tax under proposed UN tax rules.
Negotiations on a global tax treaty are set to resume at UN headquarters in New York, with dozens of countries supporting stronger rules that would hold polluters accountable for their environmental impact.
Developing nations, however, have expressed concern that the current draft is too weak and are demanding firmer commitments from wealthy countries.
Proposals on taxing fossil fuel company profits have been softened, and plans for a global asset registry to track and tax the wealthiest individuals have been removed from the draft.
Marlene Nembhard Parker, Jamaica’s lead delegate to the negotiations, cited Hurricane Melissa, which wiped out 40% of the country’s GDP, as evidence of the urgent need for stronger environmental taxation.
She emphasized that linking global tax rules to climate change and sustainable development is essential for enabling countries to rebuild sustainably and reduce dependence on borrowing.
Progress on the treaty, first proposed by African nations in 2022, has been slow.
The United States has withdrawn from talks, though other countries may proceed without it.
Some rich nations argue that tax matters should be discussed through the OECD, which excludes developing countries, instead of the UN, which allows participation from all member states.
If implemented, the treaty could ensure fossil fuel producers pay for environmental damage and compel the wealthiest individuals to contribute fairly.
Global wealth inequality is stark, with the richest 0.001 percent owning three times more than the poorest 50 percent and the gap continues to widen.
Sergio Chaparo Hernandez of the Tax Justice Network warned that the upcoming talks will test whether countries can craft international tax rules suitable for the climate crisis era.
Civil society advocates are pressing for clear mandates on progressive environmental taxation, ensuring that polluters and wealthier nations shoulder responsibility while supporting climate-resilient development in vulnerable countries.
Multinational corporations and wealthy individuals currently avoid taxes using loopholes, costing governments an estimated $492 billion annually.
Campaigners argue that taxing fossil fuel profits and the ultra-rich could generate trillions to fund climate adaptation and reduce global inequality.
Countries most affected by climate change, including Tuvalu, insist the world’s biggest polluters must bear responsibility as their industries and wealth continue to grow despite worsening climate crises.
The proposed treaty seeks to enable coordinated global taxation on fossil fuel exploitation and wealth to ensure fairness, accountability, and climate justice for the most vulnerable populations.
