Can taxation tools help advance the United Nations Sustainable Development Goals (SDGs)? This is the question the UCL Institute for Innovation and Public Purpose (IIPP), directed by the economist Mariana Mazzucato, and Diputación Foral de Bizkaia have tried to answer by designing the «Bicay Model», a composite index to quantify effort and success of companies in implementing UN´s SGDs and to correspondingly allocate tax incentives.
Foral tax autonomy enable Diputaciones Forales to become the first local or regional authorities to implement fiscal policies that are aligned with the SDGs. Through its work with IIPP, Diputación Foral de Bizkaia has become a ‘living lab’ for a new way of thinking about taxation and sustainability. This work marks the first step towards a new approach to the role of regional fiscal policy tools in providing directionality and shape markets to be greener and fairer. Such work has the potential to help regions and states better address the climate emergency and pursue the SDGs.
The three main priority areas pursued by the «Biscay Model» are:
- Demographic shifts (SDG3 Health, SDG4 Quality Educaation & SDG5 Gender)
- Climate crisis (SDG7 Energy, SDG12 Sustainable consumption, SDG13 Climate & SDG15)
- Economic resilience (SDG8 Decent work, SDG9 Infrastructure and R&D, SDG11 Cities)
The Biscay project is described in three documents. The first is the Concept Note, which describes the challenge, details the rationale for a market-shaping approach, and introduces the composite index approach and its core components. The second document, the Summary Contribution Areas, describes the 28 indicators or contribution areas (CAs) that compose the index; this provides a starting place for further consultation. Finally, the third document is an executive summary that covers the main ideas set out in these three documents. The three documents can be downloaded in the following links:
