Fair taxation within the scope of the European Union tax policy strategy: Selected EU member states review

The European Union (EU) encourages harmonization between the tax systems of its member states in line with the goal of ensuring the free movement of production factors in the process of economic and political integration. Although it does not have a common tax system, tax policies are shaped within the framework of principles such as preventing unfair competition, ensuring tax transparency, fair taxation and combating double taxation. Tax cooperation, developed since the Treaty of Rome, aims to ensure that national tax policies are compatible with the integration goals of the EU. Tax justice is a fundamental principle that ensures the social acceptance and legal validity of tax policies implemented at both national and international levels. While fair taxation aims to distribute the tax burden in a balanced manner according to individuals' ability to pay, it also includes efforts to combat the informal economy, tax avoidance, and tax havens. In today's world, where digitalization and globalization are eroding the tax base, EU tax policy seeks to ensure fairness by maintaining the balance between direct and indirect taxes, enhancing information exchange, and approximating tax rates among member states. In the first part of the study, tax justice is analyzed based on a literature review within the framework of the taxation principles, the factors that negatively affect these principles, and the tax harmonization policies of the EU. In the application part, the tax practices of 16 developed and developing EU countries are evaluated in terms of tax rates, the share of tax types in GDP, the size of the informal economy, double taxation agreements, and compliance with EU taxation principles. According to the findings, although the practices aimed at ensuring tax justice vary at the country level, it is observed that the progressive income tax structure supports income equality. However, the high share of indirect taxes in total tax revenues and the decreasing share of direct taxes are considered to negatively affect tax justice. This situation increases the need for structural reforms to strengthen tax fairness across the EU. The informal economy and harmful tax competition are among the main factors that make it difficult to implement the principle of fair taxation. It has been observed that member states support their tax systems through both domestic policy arrangements and international agreements to combat these problems.