Want the rich to pay their taxes? Then publish their tax returns.

Paris Marx
Jul 28, 2017 · 3 min read

Last week, the BBC published a report outlining the salaries of the highest-paid employees at the public broadcaster, and while there’s been some debate about whether certain presenters should be paid such outrageous sums, it was the gender pay gap that really made headlines.

The corporation has pledged to achieve pay equity by 2020, but the report has given female presenters the evidence they needed to show the public the full nature of the unfairness. Without the transparency provided by the report, it’s highly unlikely that this topic would have made the national conversation in such a significant way. It shows the power of wage transparency, and should be proof to workers in other fields that making such information public is actually to everyone’s benefit.

As it stands, it’s very rare for tax returns to be made public in many countries, and most employers tell their employees that they aren’t allowed to even talk to each other about how much they get paid. Why does this happen? It’s very simple: the lack of transparency ensures the employer has more power to keep wages low and pay people vastly different sums for performing the same job. How is that fair?

However, that’s not the way it works everywhere. The Nordic countries provide an example of the public benefit that can be achieved from making the small sacrifice of publishing tax returns for all to see. Worried your neighbour might go snooping to see your salary? Firstly, who fucking cares? Secondly, don’t worry, Norway has figured out a way to make sure you know the identity of anyone who views your return.

Public tax returns reduce inequality

Iceland, Norway, Finland, and Sweden top the rankings for gender equality, and Iceland is even forcing companies to prove they pay workers equally regardless of gender. The Nordic countries are also among the least unequal countries in the world, and many make some combination of the income, taxes paid, and capital gains of each citizen public every year.

Many people may think the Nordics crazy to do such a thing, but it comes with so many benefits. By making tax information public, the fairness of the tax system is laid bare for everyone to see. This means that if the system is structured in a way that allows the rich to get away with paying little tax on their soaring earnings — like in the United States — it’s easier for people to see the inequality for themselves and revolt against it. Further, it makes it far more difficult to send large sums of money offshore to avoid taxes when everyone can access your income statement.

There’s also a significant benefit to average workers. Public tax returns help to reduce gender and racial pay gaps by making it easier for people to check what their coworkers are earning, giving more power to workers to bargain with the employer. By making it easier for academics to study tax returns and publish their findings, it makes it more difficult for CEOs and executives to give themselves big pay hikes and bonuses while keep the wages of the workers constant.

Still worried someone might look at your tax return? Don’t be. Seriously. We shouldn’t be so secretive about money in the first place, and the Nordic countries have come up with solutions to combat snooping. In Finland, there’s a small fee to access each line of a tax return, and people aren’t going to pay unless they really want to see what’s there, while Norway requires people sign in with their identification number so tax returns can’t be viewed anonymously.

The benefits of being transparent about our incomes and the taxes we pay far outweigh any fear we might have about sharing how much money we make. Public tax returns would contribute to reducing inequality, making the tax system fairer, and increasing the general level of trust in society. Norway has been publishing tax returns since the early 1800s, and it’s clearly worked pretty well for them. It’s time for more countries to follow their lead.

Paris Marx

Written by

Socialist, traveller, urbanist. MA Geog, McGill. I write critically on tech, cities, and media, and curate the Radical Urbanist newsletter: http://bit.ly/radurb

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