What Burden Should Fiscal Policy Bear in Fighting Global Injustice?

Abstract

In this contribution I examine how improvements in our fiscal arrangements could be an important vehicle for realizing key aspects of global justice. I begin by outlining some of the important principles that orient my account of global justice (and, moreover, should be part of any plausible account of what we should aim at in pursuing global justice). Improved institutional quality at both the state and global level has a crucial role to play in achieving global justice goals. In Sect. 2 I outline some of the challenges that must be met to deliver the necessary institutional quality in the area of taxation. Effective and legitimate states, tax morale, and an appropriate fiscal contract are all highly important for creating and sustaining an environment conducive to beneficial development, as I explain. I also sketch some of the particular obstacles for developing countries in trying to achieve the right conditions, including both domestic and international challenges that must be confronted. Section 3 covers some solutions to the problems identified and the important role developed countries can play in addressing crucial problems. For instance, as we come to appreciate, in a context of globalization, robust and equitable fiscal policies require transnational cooperation. Many concerns, such as clamping down on tax evasion and harmonizing corporate tax rates can only effectively be tackled at the global level. As I also discuss, feasible arrangements for tackling such issues are available, as are mechanisms for collecting and disbursing funds in ways that promote accountability and compliance. I outline a range of additional ways in which we can usefully discharge some of our global justice duties by assisting with several tax problems highlighted in this contribution. In Sect. 4 I discuss some positive proposals for levying global taxes that could assist enormously with realizing global justice. Here we discuss taxes that could help create conditions beneficial to development and could provide an important source of funding for core global public goods. Currency conversion taxes seem especially worthy of serious consideration, as do carbon taxes and expansions of the air-ticket tax. Section 5 briefly reviews some of the features that make the global taxes discussed both normatively desirable and politically feasible.