Designing Tax Policy in Pandemic Times: Towards a Community-Centred Approach

Gepubliceerd op: 03/06/2021

Ricardo garcia anton large

In the current COVID-19 times, the emerging role of the collectivity to face up the challenges of the pandemic has been quite visible. The value of solidarity pervades our societies, and in some cases it sidestepped the action of the public authorities. Such idea of solidarity emerged during the pandemic under the collective need to “flatten the curve” and the compliance with the social distancing measures to protect high segment of population at risk. Such extraordinary solidarity actions handled by the citizens during COVID-19 times have been documented in the works of several sociologists.(1) In his latest essay, Zizej also labeled these actions as a new sort of “communism” based on trust in the people.(2) Together with solidarity, the global responses to COVID-19, based on nation-state-based, were uncoordinated and fragmented.(3)

Both phenomena, on one hand the crisis of the nation-state to deal with global challenges, and on the other, the emerging value of solidarity, would make us think on re-designing tax policies. In my view, such re-designing of tax policy should be in line to foster the role of the communities of citizens. In the literature, Bizioli and Beretta have strongly defended the creation of a New Tax Policy Deal, in which individuals and businesses are more accountable for the maintenance of public goods (art monuments, environment, education and health).(4) Such New Tax Policy Deal enhancing the role of the communities is missing in the current fiscal and tax policy measures enacted in Italy and other countries.

Heading straight for community-centred tax policies is even more urgent than we think, bearing in mind that once the pandemic passes away, we need to recover from high public debt levels and simultaneously guarantee the resilience of our public infrastructures (i.e. public health systems) seriously hit after a decade of austerity measures and budget stringency.(5) In the literature, there have been voices that defend the creation of new taxes (i.e. carbon taxes, excess profit tax or windfall tax), increasing tax rates, or narrowing the tax gap.(6) These long-term tax recipes seem inevitable to foster economic recovery and increase the trust in our welfare states. However, one may wonder whether the above-mentioned revenue channels are sufficient to reach areas like for example the preservation of cultural heritage, which undergoes a looming challenge due to the lack of public resources since the latest financial crisis (2008-2010).(7) Therein lies the importance to design community-based tax policy.

The current tax measures to foster private engaging in preserving cultural heritage, which are basically divided in incentives to private sponsorship and incentives to private owners of cultural sites, raise severe criticisms. First, the State pinpoints what needs to be preserved and only few stakeholders are the recipients from the tax measures (owners of the protected buildings). Second, the State relies only on the non-for-profit sector to preserve cultural heritage. Such non-for-profit entities usually enjoy a partial exemption regime in corporate income tax, which is not entirely satisfactory since income derived from commercial activities on the cultural assets is not exempted. Third, the tax sponsorship regime (i.e. tax credits) applicable to the donors, is not deprived from ethical issues. There is always a risk that private donors, especially corporations, use the donations given in their own commercial benefit and economic exploitation (“marketing/branding of the cultural sites”).

To challenge this previous State-based policy, I would plead for creating tax measures that endorse a community-centred approach. Real community engagement in preserving cultural heritage is not new. In 2015, International Centre for the Study of the Preservation and Restoration of Cultural Property (ICCROM) published a report to foster a people-centred approach to cultural heritage. (8) A people-centred approach requires engaging communities in the process of making conservation and management decisions for themselves and their heritage. Such a community-centred approach rejects the premise that cultural heritage must be listed in order to be preserved. The community itself must decide which spaces, traditions and goods deserve protection and therefore exploit them in a sustainable way.

Strikingly, this community-run heritage projects are devoid of an ad-hoc legal and tax regime. This is perhaps one of the most serious handicaps of the current regulation which put the stress on the non-profit sector and the sponsorship, and therefore neglects that the local communities must play an important role in preserving our cultural heritage. A proper legal and tax regime to activate local communities and enroll them into the redevelopment of heritage sites should be created. Why not relying on cooperatives for these purposes? The principles leading the cooperative movement seem to be quite suitable to preserve cultural heritage from a people-centred approach. (9) However, no much attention has been devoted to cooperatives in the field of taxation. This example on cultural heritage tax policy serves me to stress that enhancing the role of communities in tax policy is needed for a New Tax Policy Deal. As scholars engaged with sustainable tax solutions, much work needs to be put in the forthcoming years to design community-centred policy in taxation.

(1) M. Sitrin (ed), Pandemic Solidarity Mutual Aid during the Covid-19 Crisis, (Pluto Press, 2020)

(2) S. Žižek, Pandemic!: COVID-19 Shakes the World, (OR Book, 2020); On a short overview of the philosophical debate on COVID, see Michael A. Peters, ‘Philosophy and Pandemic in the Postdigital Era: Foucault, Agamben, Žižek’, (2020) Postdigital Science and Education, issue 2, pp. 1020–1024

(3) For further criticisms on the responses given by EU Member States to COVID, see M. Alemmano,’The European Response to COVID-19: From Regulatory Emulation to Regulatory Coordination?’ (2020) 11 European Journal of Risk Regulation, issue 2, pp. 307-316

(4) G. Bizioli & G. Beretta, ‘Italy’s Tax and Fiscal Policy Measures at the Time of the COVID-19 Crisis: ‘Tax Peanuts’ Without a New Deal’, (2020) 48 Intertax, Issue 8/9 (2020) pp. 761 – 768

(5) S. van Weeghel, ‘COVID-19 and Fiscal Policies, (2020) 48 Intertax, issue 8/9, p.735; K. Van Dender, P. O’Reilly, & S. Perret, ‘COVID-19 and Fiscal Policies: Tax and Fiscal Policy in Response to the Coronavirus Crisis: Strengthening Confidence and Resilience’, (2020) 48 Intertax, Issue 8/9 (2020) pp. 736 – 742

(6) In US, an excess profit tax on corporations that benefit from the pandemic could be enacted. See R. Avi-Yonah, ‘COVID-19 and US Tax Policy: What Needs to Change?’, (2020) 48 Intertax, Issue 8/9 (2020), pp. 790 – 793; On potential windfall taxes on companies which benefited from the pandemic, see R. Collier, A. Pirlot, J. Vella, ‘COVID-19 and Fiscal Policies: Tax Policy and the COVID-19 Crisis’, (2020) 48 Intertax, Issue 8/9 (2020) pp. 794 – 804.

(7) See F. Benhamou, ‘Public Intervention for Cultural Heritage: normative issues and tools’, in I. Rizzo & Anna Mignosa (eds), Handbook on the Economics of Cultural Heritage, (Elgar, 2013), p. 14; As an example in Spain during the period 2008 – 2017, the State investment in protecting and preserving our cultural heritage has plummeted 70%. See these data in El Pais, 11 April 2017.

(8) ICCROM, ‘People-Centred Approaches to the Conservation of Cultural Heritage: Living Heritage’ (2015). Available at;

(9) In this regard, see the principles of the International Cooperative Alliance in