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Clinton to Latin America: Tax your rich

QUITO, Ecuador — U.S. Secretary of State Hillary Rodham Clinton urged Latin American nations Tuesday to impose a heavier tax burden on the wealthy, saying the region's economic growth and competitiveness depend on it.

Clinton said in a speech in the Ecuadorean capital that tax evasion among the wealthiest in the Western Hemisphere is unacceptably high and hurts efforts to build badly needed infrastructure like roads, bridges and power plants. She said it is also keeping countries in the Americas from reducing poverty and improving health care.

"Despite progress in some places, tax and budget systems are ineffective and inefficient in much of the hemisphere," she said, noting that in many countries the burden falls too heavily on lower classes.

"But," she said, "in many places, it is also a simple fact that the wealthy do not pay their fair share. We can't mince words about this. Levels of tax evasion are unacceptably high — as much or more than 50 percent in some of the region's economies when it comes to personal income tax."

As a result, she said most governments in the region are unable to afford to provide basic services.

"This is not class warfare or us-versus-them rhetoric," Clinton said. "It is a matter of recognizing that this is not a zero-sum game and that the winner-takes-all approach to our economic future is shortsighted and obsolete. More inclusive growth will make our entire economies stronger and more competitive over the long term, to the benefit of all."

Clinton has made tax equity a theme in recent speeches in Washington and overseas. She made her latest comments on the second leg of a four-nation tour of Latin America and the Caribbean that has already taken her to Peru and will see her in Colombia on Wednesday and Barbados on Thursday.

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