Tax Justice and Poverty

“Kenya and Zambia could survive without development aid if they could tax effectively and fairly what they earn in their countries.”

Jesuit Missions Germany, the Jesuit Center for Theological Reflection (Lusaka, Zambia) and the Jesuit Hakimani Center (Nairobi, Kenya) have published the results of their five-year research and cooperation on the relationship between tax justice and poverty in Germany, Kenya and Zambia.

Although three very different countries, they found some surprising parallels:

  • Income and wealth inequality are big and growing. The top 1% undermine democracy through lobbying, personal acquaintance or corruption.
  • Tax authorities have no awareness into the real financial circumstances and can accordingly enforce no tax on performance.
  • Private, corporate and criminal large assets can harm the community and shift the tax burden onto others.

But there are also some differences:

The current international tax architecture makes rich countries richer: A lot of money is drained in dark channels from Kenya and Zambia and finds its way through tax havens to Germany, where it is invested lucratively.

Jörg Alt SJ, responsible for the research project at Jesuit Missions Germany, says:

“Africa is indeed a rich continent, and the fact that African countries can not provide their citizens with a better life is also due to rich countries such as Germany:

If African countries could prevent illicit capital outflows and tax domestic value creation properly, Africa would no longer need development aid.

The rich countries of the world, including Germany, are called upon to support poor countries in accordance with the principle of help for self-help:

  • through a fairer international tax architecture,
  • through more transparency in large assets,
  • in establishing domestic tax administration,
  • in the international fight against unauthorized capital flows and the common enforcement of legitimate tax claims.

At the same time, this would be a good way to reduce migration to Europe and address the impact of climate change on the ground. ”

Further information:

You can read the full Tax Justice and Poverty report here.

Photo:

Jörg Alt SJ, Author of attached German-African Tax Justice and Poverty report.