UN: Tax competition and corporate tax avoidance "inconsistent" with human rights
Niko Luciani, Director CESR's Human RIghts in Economic Policy Program and co-coordinator of Global Alliance for Tax Justice's working group on Tax & Human RIghts, contributed this comprehensive analysis the big step forward recently taken by the UN ESCR Committee.
Last week, the UN Committee on Economic, Social and Cultural Rights – mandated to oversee compliance with the International Covenant on Economic, Social and Cultural Rights (binding in over 160 countries) – released its General Comment 24, the most recent authoritative interpretation of States’ human rights obligations in the context of business activities since the UN Guiding Principles on Business and Human Rights were adopted in 2011. "A key UN human rights body made its most definitive statement yet that corporate tax dodging – and the policies which encourage it – are incompatible with governments’ legal duties to guard against business-related human rights abuses, even when committed beyond their borders. This landmark development represents the latest signal that human rights protection bodies are increasingly poised to hold governments and companies to account for tax injustice", Luciani states.
“Lowering the rates of corporate taxes with a sole view to attracting investors encourages a race to the bottom that ultimately undermines the ability of all States to mobilize resources domestically to realize Covenant rights,” affirms the Committee. “As such, this practice is inconsistent with the duties of the States Parties to the Covenant.”
"The General Comment, Luciani explains, details governments’ legal duties to prevent and address the adverse impacts of business activities on human rights including, significantly, when these occur outside of the country’s territory. Combatting corporate tax abuse—which robs government coffers of billions every year—remains an under-explored yet crucial aspect of ensuring businesses respect human rights, as CESR has argued in various human rights and development fora".
You can read the full article on CESR's website.