UN Tax Convention: A Structural Transformation for Financing Health [Guest Essay]
Newsletter Edition #228 [The Curated Primer]
Hi,
The troubling question of financing for public goods cannot be wished away and glossed over. We cannot pretend that the very real pressures on raising resources for public investments in health, education and infrastructure is occurring elsewhere. This underpins the consequences of hollowed out public institutions we live with every day.
In today’s edition, experts from Partners in Health, discuss the recent breakthrough towards an international tax treaty at the UN, that could eventually plug the leaks in public finances, contributing to much needed resources for a range of needs, including health goals.
From Antimicrobial Resistance to Pandemic Prevention, Preparedness and Response, the negotiations on financing obligations is a heartache for developing countries, and a headache for developed ones. By addressing structural barriers in the way revenues are collected by governments (both rich and poor), vastly under-invested sectors might finally be able to tap into resources.
As a former financial journalist reporting on tax avoidance, it is exciting for me to see how interconnected and complex problems are being addressed across forums to improve development outcomes.
We are grateful for today’s contributors for enlightening our readers on the potential implications of this decision on global health financing.
Thank you for reading.
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I. GUEST ESSAY
UN Tax Convention: A Structural Transformation for Financing Health
By Joel Curtain & Alicia Yamin
Joel Curtain, jcurtain@pih.org, Senior Director of Advocacy, Partners In Health.
Alicia Ely Yamin, ayamin@pih.org Senior Adviser on Human Rights and Health Policy, Partners In Health
A recent historic vote at the United Nations has set the terms for the first-ever global treaty on tax. The treaty, known as the UN Framework Convention on International Tax Cooperation (UNTC), represents a structural transformation that has the potential to deliver significant financing and increase health and social equity.
August 16th, marked a significant milestone in the struggle for financing the world’s health and social goals.
According to the 2024 Financing for Sustainable Development Report (FSDR 2024), between USD 2.5 trillion and USD 4 trillion annually will be needed to achieve the SDGs, while according to Development Initiatives, an additional US$307–416 billion per year by 2030 is necessary just to achieve SDG 3 on “Ensuring Healthy Lives and Well-being.”
The Pressures on Health Financing: The Structural Barriers
While rarely touched upon in the dominant discourse of global health, the struggle for resourcing health is deeply intertwined with battles for economic justice.
We should take the following as a starting point: the global South is a net creditor to the global North, to the tune of $2 trillion annually. A significant contributor to these enormous outflows is the siphoning of wealth by transnational corporations headquartered in the economic North in the form of illicit financial flows (IFFs), i.e., illegal cross-border movement of money or capital, which conservatively cost African nations alone $89 billion annually.
Other forms of corporate tax evasion, tax avoidance, and the practices of secrecy jurisdictions further facilitate enormous outflows. If we examine these unjust and neocolonial dynamics further, we see that the global North’s net appropriation of labor and resources from the global South outstrips official development assistance (ODA) by a factor of 30.
Given this analysis is usually given very short shrift in the discourse of health financing, it is often development assistance that is presented as the solution. This obscures the realities of these ongoing colonial economic arrangements whereby the South develops the North, not the other way around.
While “international assistance and cooperation” needs to be massively scaled up and democratized, focusing on development assistance without addressing the structural rules of the global political economy entrenches more than challenges the inequity imbricated in the status quo.
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