Income of Brazil's Top 1% Reaches US$ 541,000 a Year, Surpassing That of France's

10/30/2017 - 14h36

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JOANA CUNHA

FROM SÃO PAULO

Being wealthy in Brazil is different from being wealthy in France. It stands for more. While the average income of the top 1% in Brazil hovers around US$ 541,000 (approximately R$ 1.8 million) per year, in France, the top 1% earns somewhere between US$ 450,000 to US$ 500,000.

The conclusion reached in the report conducted by the World Wealth and Income Database, which is co-directed by Thomas Piketty, highlights the asymmetry in Brazil when it comes to income.

According to the report, which is based on data from 2015, Brazil's top 1% is made up of 1.4 million Brazilians.

When it comes to the top 0.1%, a group made up of 140,000 people, the cutoff mark is US$ 799,200 per year, while the average income hovers at approximately US$ 2.8 million a year.

To put this in perspective, the author behind the report, Marc Morgan, pointed out that the average income in Brazil is US$ 19,500 a year.

And who would the wealthiest Brazilians be? Not included in Forbes' list of famous billionaires, most of these anonymous magnates are businessmen, judges, executives and doctors.

They are people who mostly make money through means other than wages, according to economist Monica de Bolle, who highlighted the importance of Morgan's report, since it combined data from IBGE's National Household Sample Survey (Pnad) with data from Brazil's Department of Federal Revenue.

Some of those within the select group are shareholders that own stocks in Brazil's stock market. Data from 2016 belonging to the Securities and Exchange Commission of Brazil (CVM), demonstrates that the highest annual premium paid was R$ 27 million (US$ 8.3 million) and went to the director of BR Malls. A member of the board of a pharmaceutical company called Hypermarcas also claimed a high premium, totalling R$ 22 million (US$ 6.8 million) for the year.

Magistrates can also make it into the select group of the super wealthy. Even though the constitution establishes a cap of R$ 33,760 a month (US$ 10,410), the earnings of a judge are boosted by housing aid, extraordinary services and several other benefits known as "danglers" (or "penduricalhos"), that are applied in all states.

In July, 84 magistrates of the Justice Tribunal of Mato Grosso received more than R$ 100,000 each (US$ 30,800). One judge even earned R$ 503,900 (US$ 155,500) in a single month.

The chances of being in the top 1% increase significantly for those who were trained in engineering, or other related activities. According to research by Marcelo Medeiros, from Ipea, people with such a background were 54 times more likely to make it into the top 1% when compared to workers who did not complete high school.

The chances of a university professor making it into the top 1% are almost as low as the chances of those who finished high school but did not attend college.

Translated by THOMAS MATHEWSON

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