Human Rights Day 2019 "Human rights, international tax justice and social peace" -Paula Pereda-Perez, PhD, Special Officer for Human Rights
11 December 2019
To mark Human Rights Day, the 10th of December our Special Officer for Human Rights Dr Paula Pereda-Perez prepared a reflection which you can read below.
On December 10, 1948 - 48 of the 58 member states of the United Nations voted in favour of the Universal Declaration of Human Rights. The intent was to prevent the repetition of the horrific human rights violations that had been committed during World War II. Over the years, this foundational document spurred the development of several treaties covering racial discrimination, women, children and migrant workers’ rights, torture, enforced disappearances and rights of people with disabilities. Consequently, nine core International Human Rights Instruments and their monitoring bodies have been established to monitor the implementation of the treaty provisions by the member states. At present, all 193 United Nations member States have ratified at least one of the nine core international human rights treaties, and 80 per cent have ratified four or more.
The Universal Declaration of Human rights comprises 30 articles affirming fundamental human rights to be universally protected. These rights, however, are not legally binding in themselves, but have been embedded in subsequent treaties, international and national laws. According to this document, countries commit to respect not only civil and political rights - for example the right to life, freedom of expression and religion - but also the so-called economic, social and cultural rights, such as fair and adequate remuneration, paid annual leave, access to education, health, and appropriate social services.
Seventy-one years later, all these rights are increasingly violated in a world that has grown ever more unequal. Last year, 82% of the world's wealth generated went to the wealthiest 1% of the world's population, while the poorest 50% - 3.7 billion people - did not benefit the least from such growth.
2019 has seen an unprecedented level of social unrest around the world with millions of people invading the streets and paralysing all activities in their countries. No continent has been immune to this phenomenon. While the contexts are different, what is common in Chile, Ecuador, Venezuela, Bolivia, France, Spain, Iraq, Lebanon, and Egypt, Hong Kong, among others, is the rage against extreme inequalities, corruption, and the degradation of living standards and the environment.
What is concerning about the growing levels of mass protest is the increasing repression that protesters face from the security forces of their governments. In Chile, for example, since the beginning of the protests on October 18, 352 people have been shot in the eyes by the police, leaving many of the injured partially or fully blind. There have been widespread reports of human right violations by the police and the military, including forced detentions, sexual abuse, brutal beatings and excessive force on the streets. Meanwhile, in Hong Kong, Amnesty International has reported disturbing a pattern of reckless and unlawful tactics against people during the protests, including torture. Police brutality against protesters has also been reported in France, Iran, Bolivia and many other countries experiencing mass protests.
Faced with claims from citizens, we find increasingly discredited governments, who excuse themselves by arguing they have limited budget. They face demands from the citizenry with a lack of empathy and enforce repressive measures in an attempt to regain control. They assert that are forced to take austerity measures. They want to convince citizens that there is no money to finance quality public services, that they lack the means to provide their elderly with decent pensions and that they cannot cope with the climate crisis.
However, evidence shows that austerity measures are not the solution. They only aggravate gender, ethnic and racial disparities, immerse and keep people in poverty and deprive them of access to health, education or housing. Citizens’ demands require a progressive increase in tax revenues to grant the population the goods and services necessary for a decent life.
Several public policy initiatives would allow even the most impoverished countries to increase their tax revenues. For example, it is crucial that states improve their tax system to reduced tax loopholes that lead to tax avoidance. But it is even more important that countries agree to change the international tax system, which is not only outdated but also unfair. The current system allows systematic evasion by multinational and transnational corporations, which can declare their benefits in the countries of their choice, manipulating transactions between their subsidiaries. On the one hand, these corporations manage to be deficient where taxes are high even if it is in these countries where they generate the bulk of their economic activity. On the other hand, they report high profits in jurisdictions where taxes are very low or even null, even if they do not actually have clients. This phenomenon is called Base erosion and profit shifting (BEPS).
International tax evasion is not a minor problem. For example, in the United States, 60 of the 500 largest companies, including Amazon, Netflix and General Motors, did not pay taxes in 2018, despite a cumulative profit of $ 79 billion. Developing countries are deprived of at least $ 100,000 million annually, which are diverted to tax havens. This sum is higher than all the money allocated by rich countries to development assistance.
If multinational and transnational corporations and the super-rich do not pay their fair share of taxes, governments cannot invest in access to education, health, decent pensions or take measures to mitigate and adapt to the climate crisis. Also, the tax burden affects the poorest the most, usually through regressive taxes on consumption, such as Goods and Services Tax (GST). The impact is even greater for developing countries since they depend more on corporate taxes: they represent 15% of total tax revenues in Africa and Latin America, compared with 9% in rich countries.
Tax evasion by multinational and transnational corporations and the super-rich is what recently led the Organisation for Economic Cooperation and Development (OECD) to rule for the first time in favour of a change in international tax rules. However, the ICRICT Independent Commission for the Reform of International Corporate Taxation, argues that the proposal is not ambitious or fair enough. The OECD wants to distribute only a minimal part of taxes and, according to criteria that will benefit rich countries first, at the expense of others.
Therefore, governments in developing countries must mobilise. For the first time, they can be heard. While it is clear that wealthier nations have more power in the negotiations, the OECD has invited 135 countries to be part of the consultation process on the Global Anti-Base Erosion (GloBE) Proposal. If some governments have not yet understood the importance of the issues at stake, the civil society and ordinary citizens are called to put pressure on them.
On this International Human Rights Day, we should all make a clear commitment that the fight for human rights is also the fight for a dignified life. Therefore, international taxation has to be addressed and stopped being discussed behind closed doors. We must work collectively to put the interests of the majority of citizens above the profits, often excessive, of a small group of shareholders. Only a fair and just society will ensure social peace and sustainable development. And hopefully, young protesters being blinded for fighting for universal human dignity will never happen again.