'Significantly higher' taxes rich would cut inequality without hindering growth, says IMF

The Washington-based institution upgraded every advanced nation except the UK in its latest set of forecasts and claimed that there was "good cause for greater confidence" in the world economy.

"Progressive taxation and transfers are key components of efficient fiscal redistribution", the Fund's Fiscal Monitor report said.

The International Monetary Fund has updated its outlook for the world economy - with a more optimistic tone.

The Fund noted that top personal income tax rates in Organisation for Economic Co-operation and Development rich nations had fallen to 35 percent in 2015 from an average of 62 percent in 1981.

In its report, the IMF said the decline in overall global inequality over the past 30 years resulting from globalization and technological progress masked deep issues within countries, some caused by the same factors.

The IMF office was opened in Baku in 1992. The increase in inequality has been particularly acute in advanced economies but is spread across the globe.

The IMF revised upwards its estimates for the world economy, with the global GDP rising 3.6 pct this year and to 3.7 pct in 2018 (3.5 pct and 3.6 pct, respectively, were the previous estimates).

James Daniel, assistant director of the Asia and Pacific Department of the IMF and its mission chief for China, told Xinhua in a recent interview that the strong growth momentum this year has paved way for policymakers to accelerate needed reforms and achieve safer and more sustainable growth over the medium and long term.