University of Georgia School of Law Professor Assaf Harpaz presented his article “The New Tax Sovereignty” at the Tenth International Roundtable on Taxation and Tax Policy hosted by the Netanya Academic College School of Law in Netanya, Israel, during July. 

Below is the article abstract:

Tax sovereignty has emerged as a central defense of the retreat from multilateral cooperation. The concept traditionally refers to a government’s authority to design and enforce its tax laws without external interference. Most legal scholars have studied the concept in the context of coordinated efforts to address harmful tax evasion, focusing on the sovereignty concessions those efforts require. Recent invocations of tax sovereignty have reversed that orientation, with policymakers increasingly using the principle to justify national revenue preservation, forum-shifting, and unilateralism. Nevertheless, tax sovereignty remains notoriously amorphous, and scholars have viewed it with skepticism as a concept prone to manipulation and misuse. 

This Article develops a relational theory of tax sovereignty. It argues that tax sovereignty is best construed as a principle of bounded autonomy, which does not confer unrestricted entitlements. This framework operates along multiple axes. It applies to relations among states and between states and intergovernmental organizations, to intra-state relations between national and subnational governments (e.g., U.S. states), and to relations between governments and powerful institutional actors, such as large corporations capable of shaping tax policy. Ultimately, absolute assertions of tax sovereignty are untenable even for the world’s most powerful states. Effectively taxing offshore income demands cross-border cooperation and a willingness to accept reciprocal limits to tax sovereignty.

Harpaz joined the University of Georgia School of Law as an assistant professor in summer 2024 and teaches classes in federal income tax and business taxation. Harpaz’s scholarly focus lies in international taxation, with an emphasis on the intersection of taxation and digitalization. He explores the tax challenges of the digital economy and the ways to adapt 20th-century tax laws to modern business practices.