This week, it announced the formation of a citizens' council in Austria that will receive 25 million euros, or $27.4 million, from its inheritance and decide to redistribute it.
“I have this money because the government has failed to fulfill its mandate to ensure that wealth is distributed in society in a way that it does not end up in my hands unequally, just because I am in this world in this very family. I have this money,” Engelhorn said at a press conference in German with that title.
She belongs to a small club of the world's wealthy who advocate for tax justice by demanding higher taxes for the top 1 percent of the population. In 2021, she co-founded Tax Me Now, a group of wealthy people in German-speaking countries, to address extreme inequality resulting from tax policies. Engelhorn says heirs like her don't pay inheritance taxes and therefore give almost nothing of their wealth back to society.
“In Austria, the richest 1 percent of the population hoards up to 50 percent of the net wealth. This means that a hundred percent of society owns just under half the wealth,” she wrote in a statement. “And 99 percent of people have to make do with the other half.”
She is a descendant of Friedrich Engelhorn, who founded BASF in Germany in 1865, now one of the largest chemical companies in the world. The money she donates, according to her initiative Guter Rat für Rückverteilung (Good Adviser for Redistribution), comes from an inheritance she received from her grandmother. It was not immediately clear how much of her wealth she would retain after donating $27.4 million.
Austria abolished inheritance and gift taxes In 2008. In the United States, there is no federal inheritance tax, although a few states impose an inheritance tax, according to research by the Urban Institute in Washington, D.C.
As a first step, invitations were sent to 10,000 citizens across Austria Guter Rath said he would participate in the council this week, adding that 50 people would be chosen who best reflect the makeup of the country's population. Scientific experts will also advise the council, Engelhorn said.
Engelhorn will not be part of the board that Her group said it would have free rein to make decisions about how the money is used. Guter Rath said group members will receive $1,317 in compensation for six weekends, and meetings will be held between March and June in Salzburg.
How to tax billionaires fairly has been a controversial topic in the United States. A 2021 White House analysis found that the 400 wealthiest American households paid an average of 8.2% of their income in taxes between 2010 and 2018. [what] “Many ordinary Americans are paying,” the White House said in a statement.
Kate Brady contributed to this report.
