Globalization raises fundamental issues regarding the financing of state activities. Capital, goods and people move across national borders. Many companies too can shift production sites, patents and jobs abroad.
In such an environment, can national taxation policies still bring in enough revenues to finance public budgets? Can politics still distribute tax burdens between capital and labor, between rich and poor?
Experiences with globalization up to now show that it is still possible to finance state activities. But the distribution of tax burdens is shifting in the direction of less mobile tax bases, even if that is changing quite slowly.