Tax law is inherently political. At the very least, it introduces an underlying tension in politics but is more often at the forefront of political debate. Tax is at the centre of political ideological conflict, and elections are won or lost based on tax policy. Political parties often define themselves by their position on tax with a spectrum of views ranging from a pro-business, free market economy platform to a pro-worker, egalitarian platform. ‘Taxation without representation is tyranny’, generally quoted as ‘no tax without representation’, eloquently captures the political nature of tax. More recently, reform of the tax system has been influenced by the global financial crisis and fiscal conservatism. The international tax system in particular has undergone significant reform in an attempt to address base erosion and profit shifting by multinational entities. This reform has seen jurisdictions around the world reforming their domestic tax regimes to more closely align with 21st-century corporate practices and ensure effective and efficient taxation of global corporate groups and networks.
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