Tax Justice

The tax system currently does not work in the interests of the majority of people and stands in the way of the democratic shaping of a socio-ecological transformation. The insufficient taxation of wealth and transnational corporations leads to a lack of public funds for investments in sustainable infrastructure, public goods and social systems.

Inequality in the tax system is evident both within countries, including Germany, as well as at the international level and between countries. The globalization and financial liberalization of recent decades have contributed to a complex international tax system that encourages extensive practices of tax evasion. According to estimates by the Tax Justice Network, direct revenue losses due to tax abuse amounted to around USD 480 billion worldwide in 2023, particularly due to the shifting of corporate profits to low-tax regions and the hiding of assets by wealthy individuals (State of Tax Justice Report 2023).

International Tax Justice

For countries in the Global South, the high annual losses due to capital flight, aggressive tax avoidance and illegitimate financial flows are particularly serious.

Contrary to widespread perceptions that associate tax havens and financial secrecy exclusively with small island states, it is important to emphasize the important role of rich countries in the North in maintaining a global network of secrecy and lack of transparency that enables tax abuse. This also applies to Germany, which was ranked seventh in Tax Justice Network's latest Financial Secrecy Index 2022. Rich countries also have the biggest decision making power when it comes to the distribution of global corporate taxes.

A crucial question is who sits at the table when international tax issues and financial transparency are negotiated, because 'when you are not at the table you are on the menu'. Up to now, it has mainly been the OECD, as an association of rich countries, that has set the most important rules for global tax policy.

WEED supports the call for a democratization of negotiations on global tax issues by shifting them to the United Nations. We call on the German government and other rich OECD countries to participate constructively in the current process of drafting a UN tax convention. This would be an important step towards enabling fairer rules for global corporate taxation and better transparency in global (shadow) financial centers.

WEED is currently pursuing the issue of tax justice primarily through networks. WEED is an active member of the German Tax Justice Network (Netzwerk Steuergerechtigkeit) and is represented on its coordination committee. WEED is also a member of Eurodad.