Part III Assessing resources Chapter 11: Analysing resource mobilization KEY QUESTIONS • What are the main sources of government revenue? • How do these different sources impact on human rights? • How can we assess whether resource generation is fair and efficient? INTRODUCTION If resources allocated to the fulfilment of ESCR are inadequate, our next question is: Are there additional resources available that could be used? The obligation on the State to use the maximum of its available resources is not just about allocating existing resources effectively (i.e. “dividing the pie”, as the saying goes). It also includes an obligation to effectively mobilize resources (i.e. to increase the size of the pie) in equitable ways. For this reason, it is important to evaluate how the State is generating, as well as spending, resources. This chapter outlines the ways that governments can generate resources, focusing in particular on taxation. It then discusses how to evaluate taxation policy to determine if it is generating sufficient resources and whether or not it is doing so equitably. The equitable generation of resources is a particular concern for gender budgeting. 11.1. HOW CAN THE STATE RAISE REVENUE? To pay for everything it has budgeted to do, a government must raise revenue. It can do this in a number of ways. It may levy taxes, receive overseas development assistance or, where necessary, borrow money to meet a budget deficit. The amount of resources available from each of these sources is, in turn, influenced by monetary policy and financial regulation. As discussed in Chapter 9, along with government expenditure, these are key policy areas when evaluating whether a State is maximizing resource availability to realize human rights. WHY BOTHER WITH TAX? The link between taxation and development is fundamental. A functioning State that can meet the basic needs of its citizens must rely ultimately on its own revenues to meet development objectives. Using the tax system, the State can mobilize domestic resources, redistribute wealth and provide essential services and infrastructure. Effective tax structures can also create incentives to improve governance, strengthening channels of political representation and reducing corruption. Governments across the world struggle to collect enough taxes to fund essential services in a fair way. [Developing countries] in particular face serious challenges as a result of weak and underresourced revenue authorities, large informal sectors, pressure to offer overly generous tax breaks, and the exploitation of tax loopholes by unscrupulous companies and rich individuals. Too often tax systems are heavily skewed against the interests of the poorest. Source: Tax Justice Advocacy: A Toolkit for Civil Society, Christian Aid Chapter 11: Analysing resource mobilization | 111