We are at a crossroads in defining the future of sustainable development. Over the summer, UN member states hashed out some agreement on a proposed set of Sustainable Development Goals (SDGs) and targets, and simultaneously devised a 'menu of options' for financing these universal goals. The UN Secretary General's office is at the grind now to synthesize these proposals and many more into a workable set of recommendations for what the post-2015 sustainable development framework could and should look like.
As the post-2015 process now starts to harden and faultlines become more pronounced, experts and activists from the development, environmental and human rights communities are converging around a fairly straightforward argument. (The short list of recommended reading starts here: the UN Millennium Campaign Africa, Oxfam, Save the Children, Global Financial Integrity, Action Aid, the UN Special Rapporteur on Extreme Poverty and Human Rights, Christian Aid and my organization the Center for Economic and Social Rights, alongside a wide array of academics and other experts).
Unless governments agree to concrete tax and budgetary commitments which ensure robust, equitable and accountable fiscal foundations for sustainable development, the SDGs will end up merely dead letters.
Why is fiscal justice - that is, ensuring the sufficiency, equality and accountability of financing - so central to delivering sustainable development? Much more money will need to be mobilized for sustainable development - on the order of a trillion dollars a year. According to our recent findings, a range of complementary domestic and global fiscal commitments - from ending harmful corporate income tax exemptions, to boosting financial transparency to taxing illicit financial flows and carbon emissions to name just a few - can unleash at least US$1.5 trillion per year in additional, stable and predictable public funding to end poverty, inequality and environmental destruction.
Equality in the burdens and benefits of sustainable development financing within and between countries meanwhile is as important as the total amount raised. "Collecting taxes is not enough," as the Head of the Uruguayan Tax Collection Agency recently said, "what matters is how and from whom." Concrete post-2015 commitments to reduce economic inequality within countries through enhanced use of progressive taxation on income and wealth, while simultaneously augmenting investments in marginalized regions and amongst disadvantaged groups would provide a needed boost to reducing corrosive levels of socio-economic inequality in all countries.
Lastly, robust and truly equitable fiscal policy - as any government official or budget analyst would say - is inherently vulnerable to being undermined by politics. At the heart of many development financing challenges lie stark imbalances of (public and private) power in domestic and trans-national decision-making over how resources are raised and spent. Good intentions are not enough to push back against this potent driver of political and economic inequality. Ensuring poor and disadvantaged communities have the right to access timely, accessible and relevant fiscal information, enabling effective and meaningful participation in the design, implementation and monitoring of budget, tax and fiscal policy and ensuring effective remedy for fiscal harms is thus a third essential pre-condition for an effective sustainable development financing strategy.
The struggle for fiscal justice post-2015 won't be easy, and will need all the help it can get. So, how might existing human rights standards and accountability mechanisms help overcome some of the obstacles to ensure robust, equitable and accountable fiscal foundations for sustainable development?
First, ensuring adequate public funding for sustainable development will require a step-change in international cooperation. While some of the proposed targets (say boosting the capacity of public revenue authorities) could be acted on by states individually, the grand majority of the actions needed to ensure sufficient resources for sustainable development will require concerted action by many governments North and South. Poor countries could commit to a universal domestic resource floor of 20% tax/GDP by 2020, for example, but this would be unachievable in most cases while the finances flowing in and out of their countries remain illicit, and the countries benefitting from the current system refuse to propose collective sanctions for private and public actors refusing to cooperate cross-border tax abuses, let alone conduct spillover analyses of the impact of their tax practices on sustainable development.
Despite varied attempts to obfuscate the facts, several human rights treaties do indeed require by law that governments cooperate internationally, commensurate with their capacities, resources and influence. These legal duties - founded in the UN Charter and other key sources of international law - imply that governments must collaborate with, and not undermine, other governments' efforts to mobilize the maximum of available resources for human rights and sustainable development. Government laws and policies which have the effect of preventing other countries from resourcing rights in equitable ways (e.g. supporting cross-border tax evasion, improper regulation of abusive private financial actors, private creditors or other business enterprises, aid or trade conditionalities, and unjustifiable constraints on deficit financing) clearly work against the achievement of human rights and sustainable development goals. In this way, human rights can help recast the basic principles of the global tax regime away from tax competition and systemic regulatory arbitrage towards international cooperation and equality before the law.
A second key obstacle to ensuring the SDGs actually deliver fiscal justice, pointed out most recently by Alex Cobham, is the resistance from some quarters to including specific fiscal policy measures and national responsibilities as targets or indicators in themselves. National ownership of sustainable development is essential for legitimate and lasting progress. Yet, tackling global fiscal challenges will be impossible without making clear who should do what, and who will be ultimately accountable if global fiscal commitments (such as on "reducing illicit financial flows by x%") are not achieved. Without including specific needed policy efforts (on beneficial ownership of companies, trusts and foundations; automatic tax information exchange; mandatory fiscal policy spillover analyses, to name a few), the outcome-oriented targets will remain nebulous, elusive and ultimately un-delivered. Human rights standards, in this context, impose obligations of conduct as well as of result. Governments in other words are accountable not only for the outcomes they achieve but for the policy efforts they make, supporting the case that the targets and indicators used to measure sustainable development, especially on fiscal policy, should be policy-sensitive as well as outcome-oriented.
Effective fiscal accountability remains another challenge which can be more fully addressed through recourse to human rights. While on the surface it might seem that the struggle over whether or not to include SDG targets on political participation, freedom of assembly, right to information and access to justice are far afield from financing development, these fundamental human rights lay at the very foundation of fair fiscal policy. Fiscal accountability - characterized by the right to access timely, accessible and relevant fiscal information, meaningful and organized participation in the design, implementation and monitoring of fiscal policy, and the provision of effective remedies for fiscal harms - is a key determinant in strengthening tax compliance and tax morale and essential to ultimately carrying through on promised development commitments. What's more, it is a human rights imperative. As such, an array of human rights mechanisms - from constitutional courts to national human rights commissions to UN treaty bodies - are being increasingly invoked , particularly in the context of the economic crisis and austerity. These human rights bodies have a still-untapped potential to protect peoples' fundamental rights to transparency, information, participation and accountability in fiscal policy decisions at all levels.
Lastly, framing fiscal justice as a human rights issue takes it beyond the elite technocratic sphere into the arena of legitimate public scrutiny, debate and mobilization around fundamental values of equality, solidarity and justice. This can help not only check the near-hegemonic influence of private interests over tax policy, but also broaden the platform to a broader range of social actors not yet engaged in tax advocacy, such as budget analysts, corporate accountability campaigners, social movements, litigators and academics. Sustained alliance-building will be required in the coming years to turn human rights principles into a coherent, universal and enforceable body of fiscal policy standards, respected in practice by governments, international institutions, multinational businesses and their advisers/financiers.
Financing sustainable development adequately, equitably and accountably remains a significant challenge which the UN post-2015 agenda and next year's Financing for Development conference in Addis Ababa is well-placed to address. Far from a political lightning rod, human rights standards and mechanisms can be dynamic tools in this struggle.
This article, originally written for the Righting Finance Initiative, was adapted from the author's presentation at the event, Human rights and tax policies in the post-2015 development agenda: Towards a transformative partnership on June 16th 2014 at UN Headquarters.