Eurodad believes that for developing countries and their people, a key way to raise funds is through national taxes. Domestic resource mobilisation- raising money from the people for the people- is a reliable source of finance and a preferable alternative to foreign aid, which Eurodad research has consistently shown to be ineffective in many cases and leaves developing countries dependent on donor countries. However, policies on domestic tax, which should ultimately be decided upon nationally, are often heavily influenced by key international players: tax-related conditions and technical advice attached to loans and grants from International Financial Institutions, as well as bilateral tax agreements and investment treaties, all too often undermine the policy space of developing countries.
Such advice and conditions all too often involve lowering domestic tax levels, in a bid to attract foreign investment. This often leads to a country joining the race to the bottom on national tax policies. Low taxes mean lower public funds and a lower quality of public services.
Eurodad works in coordination with Southern CSOs including Latindadd, Afrodad, Jubilee South, and Tax Justice Network Africa and Latin America, to expose the role of private investment in developing countries and tax-related conditions in order to open up the policy space of developing countries.