European Covid Tax is urgently needed!

The urgent establishment by the european States of a system of an “emergency Covid19 tax” on corporate profits and high net worth individuals, purpose-oriented to deal with the costs of mass expenditure caused by the crisis.

The tax collection will be managed by the tax offices of each country. We propose this rate to all European countries, with the aim of creating a special european solidarity Covid-19 fund managed in a coordinated way among the States that support the initiative.

The funds will be used according to the needs and the impact of the pandemic in each one of the countries. The States will manage in a coordinated manner the funds received to:

We know that the medical, social and economic emergency of the Coronavirus pandemic requires an urgent and immediate response, in fact the thousands of millions of euros that have already been mobilized for this purpose are increasing an unaffordable debt for the states and hamper the ability to deal with this situation. For this reason, we believe it is fundamental that the European Central Bank (ECB) cancels all the debts of the member States aimed at tackling the causes and effects of the pandemic or, in its absence, his transformation into “permanent debt” that are unrelated to current budgets. In the meantime, and as a form of pressure for this measure, we propose the unilateral non-payment by the states, as well as a citizen audit of the whole of the debt with a view to repudiating the illegitimate part.

In these weeks, when a lot of talk has been made about the need to support european companies to overcome the crisis, it is essential to defend the suspension of all assistance to all companies with headquarters, parent-companies or subsidiary businesses in a tax haven or have legal formulae with corporate and tax whose real purpose is to help the evasion and fiscal dumping, adopting the most strict definitions of a tax haven, as in the list proposed by Oxfam or the Tax Justice Network. In addition, what is needed is a coordination of the States to establish economic sanctions against those countries, inside and outside the EU, that are acting as tax havens. Only thus will it be possible to deal with the mass tax fraud which, together with the neo-liberal policies, has drastically reduced the revenue collection capacity of the States.

Likewise, these last months we have seen how central banks of Great Britain or the US are directly funding governments “unlimitedly” to fight the epidemic and its consequences. We believe that it is essential, that as it has been done with the deficit ceiling, to break with the straitjacket of neoliberalism that prevents that Central Banks that make up the euro system can fund states directly. The neo-liberal policy constitutionalized in many of the european treaties has not only revealed unable to deal with the pandemic but has also demonstrated to be an impediment, it is the time to break these treaties and turn the tables on Europe.

The COVID-19 pandemic demonstrates the profound incompatibility between the functioning of capitalism and the defense of life. For this reason, the horizon that guides our policies must be to give birth to a new productive model, social and economically fair, democratic and sustainable that puts an end to inequalities, poverty and attacks on the environement. We believe that, more than ever, we must contribute to the awareness and mobilization in our societies. Obviously, for this battle the application of these european emergency COVID-19 taxes won’t be sufficient. The challenge is much broader. But we need to stard somewhere. And perhaps the time has come to put some concrete proposals in the agenda.