TAXLAW: The authority of expertise in professional tax law practice
The Research Council of Norway has awarded a grant for the implementation of the R&D project The Authority of Expertise in Professional Tax Law Practice (TAXLAW).
The Yellow Vests’ riots in France crystallise two central concerns in our times: 1) populist critique of political and expert elites, and 2) a growing disbelief in the justice and efficiency of tax systems, which further may threaten the sustainability of the welfare state (Pierson 2011). In broader public debates in several European countries, the fairness of the tax system is questioned as companies such as Apple and Amazon, and private individuals, escape tax obligations. Current debates over banning state support to companies with registrations in tax havens are mired in legal indeterminacy. The current economic challenges related to the Covid-19 pandemic, and the need for public spending and reduced fiscal income to states, accentuate how crucial an efficient and legitimate tax system is to society. Legal experts in public administrations have creative and technically complex suggestions for tax measures that balance the need for lenience with a private sector in distress, and the need for public authorities not to lose out on too much of their fiscal incomes.
What is the legal experts’ role in designing tax measures that secure the industrial renewal, the labour market, and pathways to a greener economy? We rely on tax law experts (in public administration, in private firms, in universities and in court), but their role also raises questions concerning the power-balance between expertise and policy, and on how we can hold those who shape tax policy accountable.
Most of the limits to redistributive effects of tax systems are legal, with loopholes found with the help of legal experts in private firms counselling their clients. The clients are often multinational firms developing complex multi-jurisdictional corporate structures constructed to contain legal ambiguities (Picciotto 2015). The increasing internationalization of law and consultancy firms is accelerating this process, as well as forms of professionalization among lawyers (Francis 2020).
Citizens’ willingness to pay taxes depends on the tax system’s legitimacy (Levi 1988). That legitimacy has many sources, but legal authority is central to it. Legal authority (legitimate power (Weber 1992 )) is based on legal texts and institutions, but also professional practice and expertise. How do legal experts draw the line between their own expertise and politics? Who and what shape lawyers’ ideas of what is ‘good’ tax policy?
Much scholarship on expertise-policy relationship focuses on discussing the legitimacy of an abstract idea of expertise that may be very different from the expertise actually in use. Social studies of law have focused on laypeople’s conceptions of the law, but taken lawyers’ conception of it for granted. Current reorganizations of the professional field, regarding the size and reach of law firms, lawyers’ jurisdiction, educational and career tracks, the feminization, internationalization and digitalization of the profession, and the relationship between legal and other forms of expertise, suggest it would be unwise to take for granted what legal expertise is and how it represents a source of authority. These transformations are likely to alter – strengthening or challenging – the role of legal expertise in shaping the legitimacy of tax systems.