This research was undertaken for the International Commission on Financing Global Education Opportunity. Their overall mandate, “to reverse the lack of financing for education around the world”, links directly to the newly-approved U.N. Sustainable Development Goals (SDGs), of which Goal 4 concerns education: “Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all.” Education is a fundamental human right, an established global priority, and a global public good, the provision of which is not only a moral imperative but also essential to the achievement of all development goals. While the Commission’s concern is with education, this report focuses on global taxation to support all the SDGs. Overall, the SDGs provide a powerful framework for global commitments to human progress for the period 2016-2030.
The study makes an important contribution to the work of the International Commission on Financing Global Education Opportunity. It reflects on the commitment by 193 countries to the Sustainable Development Goals (SDGs) to redress injustice and inequality within a framework that offers a sustainable future for the planet and its children. Highlighting education’s critical role to play, both as a key goal in itself and as a means to support the achievement of all the other goals, the Report notes that to deliver on its transformative potential, education needs long term sustainable financing. The report makes the case that revenues and wealth generated in developing countries must be fairly reinvested. It explores the potential of globally-levied taxes and coordinated international actions to build truly effective and accountable education systems.
The research exams two areas of tax. First, what and how global reforms might to support domestic taxes, and second, the potential impact of globally levied taxes. Global losses from multinational companies tax evasion and avoidance is estimated at US $600 billion (IMF) each year. Revenue losses on income taxes due to undeclared offshore wealth, meanwhile, are estimated to approach $200 billion. The study argues that global counter measures are central to strengthening available domestic revenue budgets for education and public services more broadly. The study concludes that the measures needed for meaningful financial transparency and accountability should be underpinned and supported by the establishment of an intergovernmental tax body.
- A global financial registry provides a powerful tool for tax authorities to challenge tax evasion.
- A registry of BO and AEI data would facilitate a globally applied wealth tax.
- A global wealth tax rate of 1% could potentially meet the SDG funding requirements in full.
- Global revenues exceeding US $300 billion could be raised from a financial transaction tax and be earmarked for public education in low-income countries
- Transparency and accountability are key to facilitating national level revenue increases.
- Coordinated international action to ensure the availability of information for national or global taxes.
- Publication of country-by-country reporting by all MNCs.
- Public registers of ultimate beneficial ownership of companies, trusts and foundations.
- Comprehensive, automatic exchange of financial information between jurisdictions.
- A global, public registry of financial wealth.