the new global action plan must also look beyond aid to other means of financing development. She pointed to the need to tackle tax dodging and financial secrecy, which have led to trillions of dollars being hidden in tax havens by tax dodgers, bribe-takers, money launderers and other criminals.
This robs public services such as schools, hospitals and police forces the world over of much-needed funding – and hits hardest against poor people who rely on public provision. Christian Aid estimates that every year, tax dodging deprives poor countries of $160 billion – more than they receive in aid.
Slightly missing the point that Africa alone is also getting some $500 billion a year in private sector investment. A rather more important number one might suspect.
Consideration of how to tackle capital flight and to strengthen domestic taxation measures will be key to increasing domestic revenues. It is now widely accepted that illicit financial outflows (dominated by corporate tax evasion) dwarf receipts of aid.
Progressive taxation plays a critical role in raising revenues to fund social protection mechanisms and universal access to basic services, and also in establishing the social contract between states and citizens upon which effective political representation and accountability depend. A major issue for the post-2015 framework is to what extent it should emphasise both domestic budgetary transparency and the international financial transparency between states that is necessary to combat illicit flows.
That social contract between state and citizens. Take that logically: not as the piece of lefty boilerplate that it is. This means that the citizenry should be paying taxes so that this social contract exists. Given that companies don\’t have the vote and that no one is going to offer it to them (City of London aside) doesn\’t this mean that in order to foster the social contract we must NOT tax companies and thus instead tax the citizenry?
BTW: Africa is developing very nicely just at present. Best performance since the immediate post-colonial era (funded by borrowing to finance insane import substitution policies and we all know how that turned out) so obviously someone, somewhere, is doing something right. Quite possibly best to leave well alone, eh?