Towards a General Theory of Soc ial and Tax Expendit

Towards a General Theory of Soc ial and Tax Expendit
The first section of this two-part dissertation is descriptive and explanatory in nature, with the second being more theoretical and prescriptive. After noting the proliferation of social and tax expenditures over the past thirty years or so, both in France and abroad, the dissertation starts with an analysis of the phenomenon's political, budgetary and economic causes. Achieving a general understanding of the social nature of social and tax expenditures requires a Political class theory, a Rule of law theory and an Optimal compulsory levies theory. The notion of benchmark tax system being irrelevant, we  divide the taxation system into six main categories that might be qualified as specific reference segments, each with their own fiscal standards. We use this theoretical framework to devise a definition of social and tax expenditures that will further elucidate how the concept differs from a simple determination of compulsory levies which constitutes an integral part of the social levies and tax system. We define also a doctrine that aspires to a coherent representation of social an tax expenditures, based on a succession of filters helping to ascertain which loopholes are legitimate, useful and relevant, and which are efficient, effective and above all social and politically acceptable. Applying this overall theoretical framework to the French social levies and tax system, the present paper will identify the main social and tax expenditures in the year 2015. The paper concludes by suggesting rational policies for creating new loopholes, as well as a general policy that might actually exercise real control over social and tax expenditures.