Harmonizing tax structures in EU to secure sustainable revenues (WP2)
In the after-math of a long period of economic crisis in Europe the demand for fiscal sustainability has become a top priority. But how can EU states create tax policies that builds sustainable societies, from both an economic, social, environmental and cultural perspective?
During several decades concerns related to economic durability has dominated tax reforms and “taxing for growth”-policies, at the cost of social concerns for redistributive purposes. Shifting to a focus on “taxing for equality” will promote tax policies that aims to narrow income gaps and decrease social exclusion.
Researchers in this part of the FairTax project will develop theoretical taxation models on the complexity of sustainability to show at what crossroads tax policies stands in the choice of tax bases, structures, units, rates and the total tax mixes. All aspects of sustainability – economic, social, environmental and cultural – have to be considered. Within that framework researches want to identify what tax instruments that most likely will promote economic growth without intensifying growing income inequalities, accelerating environmental degradation or increased tax noncompliance. The focus of this analysis centers on identifying alternative tax bases, rate structures, and total tax mixes that should be recommended for adoption by existing and future EU member states.
A sustainability framework will be used to benchmark the development of domestic tax policies and make a comparative analysis. Comparative studies for the purpose of quantitative benchmarking will also be conducted.