In a report – Tax as a force for good: Rebalancing our tax systems to support a global economy fit for the future - ACCA calls on governments to rethink the design of the tax system holistically.
The report proposes a ‘tax evolution’: increasing taxes on pollution and natural resource use, and reducing the tax burden on labour.
Specific tax measures, such as a carbon tax, landfill levies or taxes on single-use plastic, may help but they are no longer enough. In order to craft a tax system that is fit for the 21st century, it is necessary to think more widely about what governments should be taxing, and how the tax revenues should be used.
ACCA’s corporate reporting and tax manager, Yen-pei Chen, says:
‘During the week of the 24th Conference of the Parties, we are urging governments to rebalance the tax system to allow countries to meet their carbon reduction targets.
‘Governments need to put a price on pollution and resource-use, starting with abolishing fossil fuel subsidies and pricing carbon emissions. Tax revenues can be used to reduce taxes on labour and increase social protection, in particular addressing the needs of lower-income households.
‘Lowering the labour tax burden will help governments to achieve their UN Sustainable Development Goals, by getting more people into decent work.’
Yen-pei Chen continues:
‘Businesses are already paving the way and staying relevant for the future, by applying internal carbon and water pricing. The business case to act now is clear: achieving the UN Sustainable Development Goals can open up at least $12 trillion of market opportunities across the world in different sectors, according to the Business and Sustainable Development Commission.’
Full press release
Full report
© ACA - Association of Consulting Actuaries
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