Taxpayer Groups Challenge Multilateral Tax Agendas
Americans for Tax Reform is one of 20 taxpayer and free market groups from 15 countries which have signed a letter to world leaders to outline their opposition to transnational tax initiatives and any increase or harmonization of excise taxes.
In 2012, the World Health Organization proposed to raise certain excise taxes by USD0.05, USD0.03, or USD0.01, depending on the wealth of the country where the products are sold. The proposal, which aimed to raise more money for international causes, was defeated after farmers and taxpayer groups spoke out against the proposal.
The groups’ letter was released ahead of the October 13, 2014, meeting of the World Health Organization in Moscow, which is to consider mandating expansion of excise taxes worldwide. The letter says the proposals would degrade national sovereignty.
The letter begins: “We, the undersigned taxpayer, free market groups, and individuals support tax autonomy and oppose any regional or international tax changes that include ‘harmonizing’ tax rates or introducing new taxes. Such schemes have been proposed through the European Union (EU), the United Nations (UN), and the Organisation for Economic Co-operation and Development (OECD).”
Taxing everyone at the same level undermines the incentives to globalize and expand economic innovation, the letter says. Instead, the letter encourages tax competition between states as a free market driver that promotes increased economic activity. The co-signees say that tax competition is a natural dynamic that allows people to move economic resources from higher tax areas to low tax areas to deploy resources in the most efficient manner.
It says: “A much-discussed tax is the Financial Transactions Tax (FTT), also known as the Tobin Tax, which has been proposed in various guises by different bodies over the past few years including the EU. One model, proposed by the UN, is a world tax imposed on all financial transactions, with the goal of funding a global model of social services including basic income, free healthcare, education, and housing to those the UN deem in need.”
“There have been attempts by the EU and by the World Health Organization (WHO) to establish uniform excise taxes on products such as sugary drinks, tobacco, and alcohol. This would represent a dangerous precedent, and such excise taxes could be easily extended to all other consumer products,” the letter says.
It concludes: “These international threats to tax sovereignty are real and they are expanding. Such policies would disproportionately hurt lower income people across the globe as the cost of consumers would increase. Attempts at establishing international tax regimes would inordinately expand the reach of the EU and the UN. As leaders of groups that support free and open markets and tax competition, we oppose any efforts on the part of any international body to levy further taxes on hardworking families.”
