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Help protect people vulnerable to the effects of COVID-19 in the US and around the globe.

Who profits from COVID-19, and how can we use that money to help us get a vaccine?

By Oxfam

Pharmaceutical and tech corporations are raking in dramatic pandemic profits, enriching wealthy, mostly white Americans. How much money are they making, and how could a tax on these excess profits help us get a vaccine and reduce inequality?

The United States is facing the deepest economic downturn since the Great Depression because of COVID-19. Despite the economic setback many are experiencing, a subset of US corporations is reaping dramatic profits that are flowing to their already wealthy, mostly white male shareholders. Black, Latinx, and working families, many of whom are disproportionately affected by the COVID-19 virus itself, are also losing their businesses and jobs, and are less likely to benefit from pandemic corporate profits.

In Pandemic Profiteers Exposed, Oxfam found that 17 of the top 25 most profitable US corporations, including Microsoft, Johnson & Johnson, Facebook, Pfizer, and Visa, are expected to make almost $85 billion more in 2020 than in previous years.

Oxfam is calling for a resurrection of the World War II-era excess profits tax, which could raise much-needed funds for COVID relief and recovery, such as providing ongoing benefits including COVID-19 testing and vaccines for every person on the planet.

Who’s winning, who’s losing in the pandemic

Companies in S&P 500 Index saw a 12 percent decline in profits in the first quarter of 2020, with an expectation of a 39 percent drop in profits in the second quarter. Small US companies are reporting their earnings are now cut in half, and analysts expect them to lose a stunning 85 percent in profits in the second quarter.

But 17 out of America’s top 25 corporations are making extraordinary profits. Oxfam found that in 2020 the top 25 most profitable US corporations are set to distribute 99 percent of net profits to shareholders—who are overwhelmingly white and predominantly male.

Oxfam found that more than 9 out of every 10 dollars of excess pandemic profits are likely to end up in the hands of white Americans, with only 32 cents for Black and Latinx communities. Meanwhile, Black people are dying from COVID-19 at a rate two times greater than would be expected based on their share of the US population, with Latinx people also making up a greater share of confirmed cases than their share of the population.

“When such dramatic and excessive profits are made during a time of global crisis and distributed to the wealthiest, the situation is not just fundamentally unjust, it is also economically inefficient,” said Niko Lusiani, senior advisor on corporate advocacy at Oxfam America, and lead author of the analysis. “Taxing these windfall profits is a fair, time-tested way to rebuild better.”

What’s a Pandemic Profit Tax and how would it work?

To level the playing field and prevent super-profitable corporations from manipulating their position of strength, Oxfam is calling for policy makers to institute a “Pandemic Profits Tax” on excess super profits during this crisis. Such a tax would not affect struggling businesses or small enterprises, only those large corporations earning sums above and beyond what they earned on average before the pandemic.

The US put in place a similar tax throughout the 1940s to help mobilize resources, and encourage shared sacrifice and public trust during our country’s last all-encompassing global test.

Here’s what we could do with Pandemic Profit Tax revenues

Oxfam’s estimates that such a tax could produce nearly $80 billion, which the country could use to choose from among these options to help people recover from the pandemic:

  • Fund immediate and ongoing global coronavirus testing needs and deliver a COVID-19 vaccine to everyone on the planet, including necessary R&D, manufacturing, procurement, distribution, and delivery.
  • Support working families and provide universal childcare and early learning programs for every child in the US.
  • Provide extended paid and sick leave for essential workers and fund SNAP and WIC programs so no one goes hungry.
  • Make voting safer and more accessible during the pandemic, including enhanced systems for vote by mail, raising voter awareness of how to vote, and shoring up vulnerabilities in election systems across the country.

For more details, read Pandemic Profiteers Exposed

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