OECD calls for higher property taxes to combat debt |

The OECD on Wednesday slightly raised its forecast for global economic growth through 2024, but at the same time called for higher wealth and environmental taxes to combat the rising debt of many countries.

In its economic outlook titled “Turning the Corner,” the Paris-based organization said global gross domestic product would grow by 3.2 percent, compared with 3.1 percent in its previous forecast.

“Global output growth has remained stable and inflation has continued to moderate,” said the semi-annual report of the Organisation for Economic Co-operation and Development (OECD).

Central banks in the United States and Europe have begun cutting interest rates as inflation, which soared following the Covid pandemic and Russia's invasion of Ukraine, is finally cooling.

The OECD pointed to “relatively robust” growth in the USA, Brazil, Great Britain, India and Indonesia. For Russia, it increased its GDP growth forecast by 1.1 percentage points to 3.7 percent.

However, the OECD slightly lowered its growth forecast for Germany, Europe's largest economy, to 0.1 percent and predicted a 0.1 percent decline in GDP for Japan. In Argentina, the economy is expected to shrink by as much as four percent.

– Debt shocks –

While the OECD raised its global GDP forecast, it sounded the alarm about rising debt and called on governments to make “greater efforts” to curb spending and raise revenues.

“Decisive fiscal policy measures are needed to ensure debt sustainability, give governments flexibility to respond to future shocks and provide resources to help address future spending pressures,” the report said.

“Governments face significant fiscal challenges due to higher debt and additional spending pressures due to ageing populations, climate change mitigation and adaptation measures, plans to increase defence spending and the need to finance new reforms,” ​​it added.

According to a United Nations report released in June, global government debt rose to a record high of $97 trillion last year, doubling since 2010.

“Without sustainable action, debt burdens will continue to rise significantly in the future and the scope to respond to future negative shocks will become increasingly limited,” warned the OECD.

On the revenue side, efforts are needed in many countries to eliminate distorting tax incentives and increase revenues from indirect taxes, environmental taxes and property taxes, the organization said.

In recent years, raising taxes on the world's richest people and large corporations has come to the fore.

US presidential candidate Kamala Harris is pushing for a tax increase for corporations and wealthier households.

The new French government under conservative Prime Minister Michel Barnier has also considered new taxes on the rich and big companies as the country faces a large budget deficit.

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