Paul L. Caron

Friday, June 19, 2020

International Tax Evasion And Human Rights

Elizabeth Donald (LL.M. (Tax) 2021, NYU), Note, Revenue Mobilization Accountability: Combating Harmful Tax Regimes With the Law of Human Rights, 50 Geo. J. Int'l L. 517 (2019):

International tax evasion has gained much consideration in recent years. Between Apple’s assertion that it was tax resident “nowhere,” and a whistleblower’s leak of Luxembourg’s secret tax rulings, the legal field has tried to remedy international tax schemes on all fronts. Recently, a number of human rights advocates and scholars have started to turn their attention to tax evasion. So the argument goes: if Luxembourg issues secret rulings to give corporations lower tax rates, it illegally takes revenue away from other countries that need the money to support their citizens. The issue with this argument is that most human rights treaties, and especially those relating to economic rights, do not have an extraterritorial application—Luxembourg cannot be held accountable for the effects of its actions abroad. For this reason, the line between international tax evasion and human rights is far too attenuated.

Yet, not all hope is lost for the connection between tax and human rights. Human rights law is applicable to domestic tax harms, such as regressive policies and poor procedural mechanisms, which prevent governments from collecting sufficient revenue to support their own people. Human rights advocates should thus redirect their efforts to these domestic concerns and use the law to seek tax reform where the work of the World Bank and International Monetary Fund (IMF) has come up short.

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