What is a wealth tax and can it work in reality?

The so-called wealth tax is a politically divisive economic policy, but one that is regaining attention amid rising inequality and shifting demographics. 

U.S. President Joe Biden in his 2024 State of the Union address took aim at the uber affluent, saying he would impose a targeted “billionaire tax” on America’s wealthiest. 

It follows an earlier G20 meeting, in which finance leaders explored plans for a global minimum tax on the world’s 3,000 billionaires.  

Colombia, Scotland and the U.S. have all proposed wealth taxes in recent years, joining the likes of Switzerland, Norway and Spain in imposing taxes specifically on the super-rich. 

And even some of the world’s wealthy are backing such calls. “This is about the wealthy contributing more to the society,” Phil White, retired entrepreneur and member of the Patriotic Millionaires group, told CNBC.  

But can such a policy work in reality, and is it likely to take hold? Watch the video above to learn more.