Not an easy road

A brief tour to the current concept of taxes as a source of funding for Citizens’ Rights.

lady godiva

Although the current political, legal and social foundation of taxes has Man as the center, this has not always been the case.

Its historical genesis is strongly associated with the financing of the war and other extraordinary expenses of the Administration in times of peace.

These forced contributions, which were not only monetary but extended to personal benefits, were imposed without limits. On the other hand, its system of validation – normative and philosophical – was very different from the current one, even though they were according to the criteria of each period about the legitimation of power and its historical context, in general, related to national defence.

That is why we say that in this matter, it has not been an easy road.

There has always been a clear correlation between the conception of the tribute and its implementation and those norms and needs of the Empire, City-state or State where they belonged, as with any other branch of Law.

Historical references on tax collection go back to the earliest government organizations in Egypt, Mesopotamia and China, about five thousand years ago.

They were applied later in Greece and after a great development in Rome, they remained in the Medieval Cities, until finally arriving at the first governments of the present countries of the world.

The task of the tax collector, because of its historical origins, has always been clearly unpopular, causing adverse manifestations, based on the lack of adequate limits, that generated manifest inequities for the citizens.

Fortunately, much has evolved – ever since – that power of the state. The first advance was given by the requirement of the principle of legality, which establishes that the taxes must have legal basis – generally of a Parliamentary type – that can not be delegated. They must be in accordance with the constitutional principles of the State, which will help to delineate it (O. E. A.,  1998).

Thus, in its political face, the tax becomes a public power to impose, as a regulated obligation to manage the application of tax laws.

Due to the later developments of the doctrine on the acts of government, the tributes become founded: they have as purpose to ensure the sustainability of the management of the common good, according to certain principles, limits and obligations of the parties.

Subsequently, other more complex developments emerged, such as the principle of proportionality (Fernández González, 2000).

This principle consists of assessing the facts demonstrating the contributory capacity of those obligated to pay, that is, the quantum of the obligation to give and proportionately, increase the correlative obligation to contribute.

Other principles were added later, such as equality, which requires equal treatment in equivalent circumstances (Bonell Colmenero, 2005) and the non-confiscation of income principle, as a limit to the measure of state power of taxation (Naveira de Casanova, 1996).

The consideration of progressivity in the application of aliquots was also introduced as a way of redistributing income, adjusting the contribution to the exact scale of the taxpayer’s economy (Barberán Lahuerta, 2006).

It was opportunely stated that the correct application of justice demanded equity in the tax, taking into account special situations or vulnerable sectors that merited a different treatment (Gherardi and Rodríguez Enriquez, 2008) regarding the general rules and principles of taxes.

Finally today, topics such as the admissibility of extra tax purposes in taxation are discussed, that is, what activities should be taxed and why. And there is also controversy over the possibility of taxing unlawful acts, among other issues.

The current view thus departs from the historical paradigm by relying on two key ideas that, with a greater or lesser degree of implementation to date in the different current tax systems, constitute a common aspiration of the same: the sense of tax and the responsibility of the Parts of the obligation.

In relation to the first item, the faculty of taxation is not conceived as a public power of the coercive type, unilateral and based on the supremacy of the State over the individual.

On the contrary, it is understood as a means by supranational States or entities to secure certain economic resources that allow them to properly perform the functions and competences that correspond to them and to which they are bound.

The purpose of the tax is to make it possible to exercise the rights of citizens.

But in addition, it is a bilateral relationship of Public Law, where it is fundamental to understand, on both sides, the importance of its existence and the sense of its magnitude: the State must attend and respond to the needs and opinions of the citizens.

Its nature is that of public service, and as such, it recognizes limits and guarantees that must be respected in its implementation and enforceability.

In turn, the faculty-duty that constitutes its exercise includes diligent and objective (transparent) action, effective, according to the resources it consumes and efficient, in terms of the results to be obtained.

Likewise, it is important to advance the commitment of taxpayers and companies to adopt responsible and ethical practices on tax matters.

These should be based on commitments to the public administration that should be in accordance with their values, as individuals and as corporations.

A current conception of the link between parts, has to aim for a mature relationship, with new spaces for institutions that will generate benefits for both parties – such as self-control, proper introduction of incentives, facilitation of compliance – where voluntary compliance rules and the exception is informality and fraud.

This kind of need is of strategic type, more and more as time passes. Its achievement will have an essential role for the sustainability of administrations in the medium and long term, due to economic, demographic, technological impact in the labor market, urbanization and climate change.

This step will require that the administration can not disengage from the results to which the product of the effort required to the taxpayer should be destined.

On the contrary, in a public service relationship, the State must be accountable for the proceeds and justify the investment and return for the benefit of society, in accordance with the principle of responsibility for government actions.

The tendency today has thus, great differences with the architecture of the thought of the past historical experiences.

We said above that in principle, tribute is conceived as a means for supranational States or entities to secure certain economic resources that enable them to create an environment in which it is possible to adequately guarantee the exercise of citizens’ rights. This is its contributory aspect, the obligation to contribute to the common support of the state apparatus. The management of the public is not possible without sufficient resources. For this reason, the beneficiaries or users of the state structures should contribute to its maintenance.

They must do so to the extent of their ability to contribute or other variables that the laws take into account when measuring and defining a taxable event.

However, other taxes are required on the basis of principles of law that do not finance the operation of the State but serve to other valuable purposes whose fulfillment is in charge of the State: security, defence, equity, the creation of a system with proper incentives,  the preservation of strategic assets, etc.

This is a consequence of the fact that the state function is one. All policies and efforts in cross-cutting issues should be aligned, creating well-planned synergies, so as to be able to effectively fulfill public responsibilities.

We refer to topics such as security, education, health, energy, economic and social development, justice, ecology and culture, science and technology.

The road traveled has led the faculty of taxation to a place that – fortunately – has little to do with its historical background.

This identity has not yet been consolidated, due to the permanent changes resulting from globalization and the evolution of thinking about the interrelationship between International Taxation and Global Development.

In the next article we will see why.

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Enhancing citizens’quality of life.

road-street-desert-industry 

New technologies to solve complex social problems

   The available new technologies will play a large role in solving complex social problems faced by administrations and organizations on the globe. 

      They will not only enable disruptive changes in the analysis of the problems we face, but also in obtaining the necessary knowledge to make the right decisions to overcome them.

     From how to measure key indicators on poverty, violence or energy-related conflicts to how to develop creative solutions to the problems of the future, there is much that can be done.

     The mathematical models, techniques and theorems that are being used in artificial intelligence will also have a determining role in the proper implementation of the policies that are designed.

       This will make public actions gain in efficiency and effectiveness, as they will be based on data.

     However, the management of the public interests must be concerned not only with leading the proactive actions of development and enhancing the quality of life but also with controlling those factors that impede development and improvements.

     In this sense, the new technological tools will be of undeniable utility for dealing with international organized crime such as economic offenses and tax fraud.

     Without effective control of these illicit acts, it is not possible for states to successfully implement initiatives that result in the well-being of society.

     To understand this, it is necessary to adequately point out the connection between crimes that weaken state structures and certain problems facing the population.

     This vision corresponds to a current conception of the concept of International Security in which its object is not limited to the protection of citizens against acts of violence.  On the contrary, it recognizes the importance of addressing all those conflicts in the system that threaten a diversity of interests of individuals, States and other non-state actors.

     Indeed, over time the object of International Security has expanded, the response to what is sought to protect from political organizations, encompassing a greater number of interests whose protection must be recognized. (Laborie Iglesias, 2016)

     Based on a clear demand from society, the most paradigmatic change that can be recognized in the matter has to do with moving from protecting “the interests of States” to protecting “the interests of individuals”.

     Thus, the new challenges for International Security also include issues of the daily life of citizens.

     Now, the first complexity we encounter is given by the fact that this phenomenon coexists with the increasing widening of inequality. There is a gap between developed and developing countries and, moreover, there is also a gap within several countries.

     In this way, people with access to a certain level of quality of life coexist with those deprived of first order needs.

     Therefore, while it may be said that more interests and rights are recognized in the timeline, this does not mean that those who were recognized in the first place are properly guaranteed to all subjects. Quite the contrary, while broadening the recognition of the legitimacy of new interests, widens the spectrum of neglected demands.

     The interests that were object of recognition of rights range from protection against hunger, wars, political persecution and violence, through access to safe drinking water, prevention of disease and full guarantee of the exercise of individual freedoms to even protection against sudden and painful alterations of the daily modus vivendi at the family, work or community level.

     The right to a cultural identity, the development of certain intellectual or artistic concerns, the conservation of biological diversity and those rights relating to the environment are contemplated (Allena, 2014);  as well as all kinds of diffuse interests and even non-current interests of future generations.

      As for the subjects to whom a legitimate interest in security is recognized, a variety of actors are allowed in the new global scenario.

       The most important decisions are no longer taken only by representatives of States.

     International negotiating forums, even formal ones, currently convene on an equal footing individuals, non-governmental organizations, large corporations, political leaders and supranational or regional organizations, as well as state leaders.

     Technological progress has also impacted on the diversity of means and modes under which the participation of the subjects takes place, the expression of social demands and, inevitably, the externalization of threats to international security (Innerarty and Solana, 2014).

     These phenomena occur in the framework of a process of re-signification of the concept of state sovereignty that we are going through. First, because it can not be affirmed according to reality since the world does not function like the traditional map that is used to represent it. Technology, the cheapness of transport and the media, as well as other social and cultural facts, blurred some borders and created others.

     This has undressed the impotence of the state – considered in isolation – to cope per se with the new threats. Nothing is possible today for any state administration without concerted action with other states and with other supra and international organizations (Serrano Palacio and García-Villanova Ruiz, 2007).

     On the contrary, terrorism and international organized crime are interrelated. They both have structures that support them and are functional in all countries.

     An adequate evaluation of these phenomena requires that States extend their level of action to a multiplicity of causes that support them and that form a network across countries, regardless of frontiers.

     In terms of perception, terrorism has been identified as the main threat to national security by the United States, Europe and virtually all international organizations, beginning with the United Nations itself.

     However, what would happen if the effects of organized crime on the quality of life and the safety of people could be objectively measured?  How far do they affect the development of social, political and economic structures?

     Transnational organized crime – without political pretensions as a structuring element, without massive diffusion of its power and activities, but, on the contrary, in an effort to remain unnoticed and operate from the shadow it is currently one of the most profitable activities on a world scale.

     Moreover, it is present in all the confines of the Earth and operates side by side with the licit structures with which we live daily, covering unsuspected reaches and endless material expressions that obstruct access to justice, education, health, the growth of the economy and the equitable distribution of wealth.

     The ways of perpetrating it are dynamic, as they modified, disappeared and reinvented with the evolution of global movements, advances in communications and technological development.

  This is why we understand that the efforts of the international community on cooperation between States and other non-State organizations in order to combat transnational organized crime should be considered a priority.

     The extension of its existence is a threat both to individuals and to the social, economic and political stability of democratic institutions.

    Like expressions of international organized crime, we find economic crimes and in particular, tax fraud.

    These crimes are committed against tax administrations and are carried out by corporations with a large contributory capacity – hence their power to characterize the crime – that evade the payment of taxes.

      To do this, they artificially direct their taxable profits to opaque jurisdictions in terms of collaboration for the exchange of information, the so-called tax havens.

   The decrease in the economic contribution they generate has a strong impact on the availability of resources from the affected state economies and recent O.C.D.E. research shows that it has an impact on savings, investment and indebtedness (O.C.D.E., 2015).

     In turn, the tax havens to which these funds are destined (Serrano Palacio and García-Villanova Ruiz, 2007) are territories with a clear functional role to the laundering of assets from other figures of organized crime and the financing of terrorism.

     Thus, although it may be an end not sought by its authors, practices aimed at evading tax payments at the reference scales, while weakening state and productive structures (World Bank, 2002),  dangerously articulate with threats to international security and other crimes with global impact, such as corruption and trafficking.

     Because of the aforementioned inefficiency of States to solve these complex conflicts in isolation, international cooperation is indispensable for the controller of compliance with the obligation to contribute to the maintenance of common political structures.

     This is why we are interested in knowing the initiatives in international cooperation to combat tax fraud and increase transparency and we ask whether and to what extent certain techniques and methods that can be successfully applied (Díaz Fernández, 2013) in the design of key actions for the sector.

Enhancing citizens’quality of life and promoting global development. The fight against organized crime and tax fraud.

road-street-desert-industry 

   The new technologies available will play a large role in solving complex social problems faced by administrations and organizations on the globe.  They will not only enable disruptive changes in the analysis of these problems but also in obtaining the necessary knowledge to make the right decisions to overcome them.

     From how to measure key indicators on poverty, violence or energy-related conflicts to how to develop creative solutions to the problems of the future, there is much that can be done.

     The mathematical models, techniques and theorems that are being used in artificial intelligence will also have a determining role in the proper implementation of the policies that are designed. This will make public actions gain in efficiency and effectiveness, as they will be based on data.

     However, the management of the public interests must be concerned not only with leading the proactive actions of development and enhancing the quality of life but also with controlling those factors that impede development and improvements.

     In this sense, the new technological tools will be of undeniable utility for dealing with international organized crime and, in particular, economic crimes and tax fraud.

     Without effective control of these illicit acts, it is not possible for states to successfully implement initiatives that result in the well-being of society.

     To understand this, it is necessary to adequately point out the connection between crimes that weaken state structures and certain problems facing the population.

     This vision corresponds to a current conception of the concept of International Security in wich its object is not limited to the protection of citizens against acts of violence.  On the contrary, it recognizes the importance of addressing all those conflicts in the system that threaten a diversity of interests of individuals, States and other non-state actors.

     Indeed, over time the object of International Security has expanded, the response to what is sought to protect from political organizations, encompassing a greater number of interests whose protection must be recognized. (Laborie Iglesias, 2016)

     Based on a clear demand from society, the most paradigmatic change that can be recognized in the matter has to do with moving from protecting “the interests of States” to protecting “the interests of individuals”.

     Thus, the new challenges for International Security also include issues of the daily life of citizens.

     Now, the first complexity we encounter is given by the fact that this phenomenon coexists with the increasing widening of inequality. There is a gap between developed and developing countries and, moreover, there is also a gap within several countries.

     In this way, people with access to a certain level of quality of life coexist with those deprived of first order needs.

     Therefore, while it may be said that more interests and rights are recognized in the timeline, this does not mean that those who were recognized in the first place are properly guaranteed to all subjects. Quite the contrary, while broadening the recognition of the legitimacy of new interests, widens the spectrum of neglected demands.

     The interests that were object of recognition of rights range from protection against hunger, wars, political persecution and violence, through access to safe drinking water, prevention of disease and full guarantee of the exercise of individual freedoms to even protection against sudden and painful alterations of the daily modus vivendi at the family, work or community level.

     The right to a cultural identity, the development of certain intellectual or artistic concerns, the conservation of biological diversity and those rights relating to the environment are contemplated (Allena, 2014);  as well as all kinds of diffuse interests and even non-current interests of future generations.

      As for the subjects to whom a legitimate interest in security is recognized, a variety of actors is allowed in the new global scenario.

       The most important decisions are no longer taken only by representatives of States.

     International negotiating forums, even formal ones, currently convene on an equal footing individuals, non-governmental organizations, large corporations, political leaders and supranational or regional organizations, as well as state leaders.

     Technological progress has also impacted on the diversity of means and modes under which the participation of the subjects takes place, the expression of social demands and, inevitably, the externalization of threats to international security (Innerarty and Solana, 2014).

     These phenomena occur in the framework of a process of re-signification of the concept of state sovereignty that we are going through. First, because it can not be affirmed according to reality since the world does not function like the traditional map that is used to represent it. Technology, the cheapness of transport and the media, as well as other social and cultural facts, blurred some borders and created others.

     This has undressed the impotence of the state – considered in isolation – to cope per se with the new threats. Nothing is possible today for any state administration without concerted action with other states and with other supra and international organizations (Serrano Palacio and García-Villanova Ruiz, 2007).

     On the contrary, terrorism and international organized crime are interrelated. They both have structures that support them and are functional in all countries.

     An adequate evaluation of these phenomena requires that States extend their level of action to a multiplicity of causes that support them and that form a network across countries, regardless of frontiers.

     In terms of perception, terrorism has been identified as the main threat to national security by the United States, Europe and virtually all international organizations, beginning with the United Nations itself.

     However, what would happen if the effects of organized crime on the quality of life and the safety of people could be objectively measured?  How far do they affect the development of social, political and economic structures?

     Transnational organized crime – without political pretensions as a structuring element, without massive diffusion of its power and activities, but, on the contrary, in an effort to remain unnoticed and operate from the shadow it is currently one of the most profitable activities on a world scale.

     Moreover, it is present in all the confines of the Earth and operates side by side with the licit structures with which we live daily, covering unsuspected reaches and endless material expressions that obstruct access to justice, education, health, the growth of the economy and the equitable distribution of wealth.

     The ways of perpetrating it are dynamic, as they modified, disappeared and reinvented with the evolution of global movements, advances in communications and technological development.

  This is why we understand that the efforts of the international community on cooperation between States and other non-State organizations in order to combat transnational organized crime should be considered a priority.

     The extension of its existence is a threat both to individuals and to the social, economic and political stability of democratic institutions.

    Like expressions of international organized crime, we find economic crimes and in particular, tax fraud.

    These crimes are committed against tax administrations and are carried out by corporations with a large contributory capacity – hence their power to characterise the crime – that evade the payment of taxes.

      To do this, they artificially direct their taxable profits to opaque jurisdictions in terms of collaboration for the exchange of information, the so-called tax havens.

   The decrease in the economic contribution they generate has a strong impact on the availability of resources from the affected state economies and recent O.C.D.E. research shows that it has an impact on savings, investment and indebtedness (O.C.D.E., 2015).

     In turn, the tax havens to which these funds are destined (Serrano Palacio and García-Villanova Ruiz, 2007) are territories with a clear functional role to the laundering of assets from other figures of organized crime and the financing of terrorism.

     Thus, although it may be an end not sought by its authors, practices aimed at evading tax payments at the reference scales, while weakening state and productive structures (World Bank, 2002),  dangerously articulate with threats to international security and other crimes with global impact, such as corruption and trafficking.

     Because of the aforementioned inefficiency of States to solve these complex conflicts in isolation, international cooperation is indispensable for the controller of compliance with the obligation to contribute to the maintenance of common political structures.

     This is why we are interested in knowing the initiatives in international cooperation to combat tax fraud and increase transparency and we ask whether and to what extent certain techniques and methods that can be successfully applied (Díaz Fernández, 2013) in the design of key actions for the sector.