The European trade movement showed a common interest in advocating fairer wealth distribution and more progressive taxation schemes as tools to fight inequality and bring about social justice. We have identified as main loopholes in the current taxation setting
– Non-progressive taxation systems that, in proportion, treat rich people better than poor.
– That overcharge wage earners for the incapacity to tax capital or develop a new tax basis
– Absence of tax system that accurately excessive wealth accumulation, property concentrations and disproportionate capital gains.
Selecting priorities for the MTFSP ETUC members have selected 14 items related to tax reform (42 times ETUC members select correlated items on social protection systems). Preference goes for adaptation of taxation systems given the challenges arising from the transition towards climate neutrality, notably by shifting the tax burden away from labour and reducing the tax wedge for low and middle-income groups towards other sources contributing to climate and environmental objectives, preventing and mitigating regressive impacts, preserving the progressive character of direct taxation and safeguarding the financing of adequate social protection and investment measures, especially those targeted towards the green transition. ETUC members consider that fair and just taxation systems are essential to support the transition to a green economy. This includes measures such as carbon pricing, eco-taxes, and incentives for environmentally friendly practices. The EU aims to ensure that the burden of these measures is distributed fairly across society. One organisation considers it urgent to address carbon pricing and revenue redistribution, implementing carbon pricing mechanisms, such as carbon taxes or emissions trading systems, to incentivise emission reductions and generate revenue for climate/related initiatives. Ensuring that the revenue from carbon pricing is used to support vulnerable groups and finance the transition to a low-carbon economy.
In conclusion, trade unions see the EU Semester as a process which creates evidence of areas in which the EU can provide a socially added value in the approximation of or establishing minimum requirements for national tax systems. Trade union asks that EU level coordination may ensure that:
– Tax systems are progressive and more redistributive, and the tax pressure on wage earners or families depending on wage earners is mitigated, and tax policies support and incentivise collective bargaining;
– The whole tax mix increases government revenues to finance social expenditure for just transition and social protection for an ageing population.
– Tax frauds and avoidance are banned, especially fighting undeclared economy, corruption and tax evasion; that tax bases are preserved and cooperation at the EU level is established to avoid
the volatility of non-labour related tax basis
– Bias on investment is removed while ensuring that polluting assets and activities are taxed more than those contributing to green objectives.
Such policy mix should move some key indicators. As indicative list or performance-oriented indicators, fiscal and policy measures in the national plans should be linked to these indicators: positive impact on increase of government expenditure in social protection and investments; reduced inequalities in income distribution; reduced poverty and increased labour market participation; increasing investments aligned with green and climate change objectives; number of workers covered by collective agreements (note, it is not an exhaustive list of impact indicators).