4 - Social Justice through Taxation?

Summary

The chapter analyses how the political and economic realities of the aftermath of the First World War gave the term ‘tax justice’ a new meaning in Belgium, occupied during four years by Germany, but also how it was fought over for moral and economic reasons during the 1920s. On the left of the political spectrum, the Socialists brought their own fiscal agenda, entailing new progressive income taxes on the wealthy. On the right, Liberals and Catholics disapproved of such innovations, judging them morally wrong and economically harmful. Compromises were found, with a real shift in the tax system. However, as the 1920s wore on, the Belgian franc suffered from a depreciation like the French and German currencies, with capital fleeing the country. The political debate on progressive income taxes shifted from justice to injustice: the massive level of tax fraud and tax evasion was making the system unfair towards honest taxpayers. Tax policies made in the name of social justice became an achievement to be defended for some and an excessive ideal to be attenuated for others.