Illusions of Justice in International Taxation

International tax law determines which states may tax what. Despite its significance, its normative foundations are poorly understood—cursorily treated by tax experts, and almost entirely neglected by philosophers. In this essay, I criticize a common way of thinking about justice in international taxation, and I propose an alternative. My critical target is a claim I call the Capture Principle. Common ground among many government officials, leading tax scholars, and several of the few philosophers who have thought about international taxation, the Capture Principle asserts that each state should have rights to tax income generated from economic activities within its territory. The Capture Principle appears to embody an ideal of reciprocity. I argue that this appearance is illusory. I examine three arguments that connect those two ideas, and I argue that each fails on its own terms. Even if we ought not to free-ride off others, ought to pay compensation for the burdens we place on others’ public sectors, ought to reward people for the surplus value that they create—the Capture Principle does not follow. This critical work reveals an interesting new research agenda for thinking about justice in international taxation.