THE RUSSIAN-UKRAINE WAR

The global financial markets braced for a shock when Russia invaded Ukraine on
February 24, 2022. The invasion had immediate and significant economic
consequences. Prices for global commodities such as food and oil continue to rise as a
result of the crisis, and the outlook appears bleak. The Ukraine conflict has resulted in
a triple food, energy, and financial crisis, according to the United Nations General
Secretary. Russia's attack on Ukraine has resulted in strong international sanctions.
However, sanctions imposed on Russia put pressure on other countries.

The events in Ukraine could not have come at a worse time for a number of countries
dealing with the aftereffects of the ongoing conflict.

This crisis is occurring in some areas amid devastating ecological degradation. The
Sahel Region of Africa encompasses ten countries, six of which are classified as
ecological hotspots and are experiencing rapid population growth, food risk, and
water risk. Economic shocks and commodity price increases are robbing these
countries of their ability to mitigate current threats and weakening their ability to
navigate future crises. Many of these countries are dealing with internal conflicts and
instability, which contributes to resource depletion. The international community's
current approach is unlikely to alleviate these pressures.

Hunger has been increasing in almost all countries affected by conflict, climate
change, and economic downturns, and the conflict in Ukraine has already
demonstrated this with commodity inflation. The global GDP, or total economic
production, is expected to fall this year. Russia is a major supplier of crude oil, natural
gas, and metals. This has resulted in higher prices for important materials, known as
commodities, causing problems all over the world, most notably in European
countries.

The United States and other Western nations have targeted Russia with severe
economic sanctions. Some Russian banks have been kicked off the SWIFT global
payment system. Exports of high technology to Russia have been limited.
Furthermore, Russia's ability to use its foreign currency reserves, which it uses to pay
for exports, has been severely limited. As a result, the value of Russia's currency, the
ruble, fell to a record low on Monday. Many Russians queued at banking machines to
withdraw money, causing damage to Russia's banking system.

The European countries are suffering as a result of their reliance on Russian energy.
Europe's economy is now in jeopardy. Natural gas prices rose by 20% after the war
began, but are now six times higher than they were at the start of 2021. Inflation is
being fueled by high gas prices, and Europeans are paying more for heating. As a
result, households have less money to spend, and prospects for economic recovery
following the COVID-19 pandemic have dimmed.

Natural gas-using industries, such as fertilizer manufacturers, must reduce output.

Farmers are paying more to run their equipment and purchase fertilizer. Germany's
economy could enter a slump in the coming weeks. Companies around the world are
scrambling to find enough goods to meet demand as the COVID-19 pandemic
subsides. This has resulted in shortages, shipping delays, and increased prices. The
conflict and sanctions will also have a negative impact on Russia's migrant workers.
The families of those workers rely on money sent home from Russia, known as
remittances. This will result in hunger and market collapse.

In some ways, the importance of the tax system during times of crisis is self-evident.
Crises such as war and disaster necessitate increased public spending, which
necessitates increased public revenue, which necessitates an increase in the burden of
taxation in one form or another. This chapter takes the fundamental revenue-raising
function of the tax system for granted and attempts to make some observations about
the proper role of the tax system in times of disaster, other than revenue-raising. This
chapter makes three general points about how fundamental tax policy concerns and
disaster management interact using United States tax policy documents prepared in
anticipation of nuclear war and tax measures implemented in response to Hurricane
Katrina. First, tax policy is often embedded in public policy as a result of the emotion
and urgency of war and disaster. Second, crises can reveal a previously unknown
capacity in the tax system to address systemic economic issues. Finally, in practice,
using the tax system to target relief is difficult.

THE WORLD'S HEALTH CRISES TODAY AND HOW TAXATION CAN

HELP SOLVE THEM

The global health landscape has shifted dramatically. Countries spend more on health
as the population ages and the burden of chronic diseases rises; novel and costly
medicines and health technologies become available, and demand for better health
rises as people's income rises.

Countries are constantly racing to secure adequate and sustainable financing for the
health sector in order to meet these demands. However, the gap between healthcare
financial needs and actual spending continues to grow. Even the richest countries
struggle to keep up with the rising costs of health care.

Meanwhile, the Sustainable Development Goals place significant pressure on

governments to maintain and expand healthcare services. Healthcare systems are
bursting at the seams, with low- and middle-income countries bearing the brunt of the
burden. Everyone agrees that people's health is important, but not everyone knows
where to find the funds to pay for it. Money can only buy health if it is spent fairly
and efficiently.

1. A global shortage of health professionals

More health workers are desperately needed around the world. Seven million more, to
be exact, and by the end of this decade, we'll need 18 million more health workers.
According to research.
The global shortage of health workers is at the top of our list because there are no
health services without health workers. The availability and quality of the health
workforce is entirely dependent on our ability to improve people's access to care and
achieve universal health coverage. Despite this, it is estimated that only half of the
countries currently have the health workforce required to provide quality health
services.

Many of the most desperate situations, such as Yemen, leave millions of people
without the medical care they require to survive. During the 2014 Ebola outbreak,
21% of Siera Leone's health workforce died. Today, only 165 doctors serve a
population of 7 million people. That equates to one doctor for every 42,400 people.

2. Climate Change Effects

Climate change is expected to kill an estimated 5 million people worldwide this year.
Climate change is no longer a debatable issue because it is a global health and
humanitarian crisis that threatens millions of lives.
Warmer temperatures and erratic weather patterns pose a number of threats to global
health, including reduced food supply, increased disease risk and spread, and
increased extreme weather events. Furthermore, the consequences of climate change
disproportionately affect those who have the least to do with it: people living in the
poorest countries bear the brunt of the consequences.

3. Pandemic preparedness
The possibility of another global pandemic is increasing. One-third of the world's
population was infected during the 1918 influenza pandemic. More than 50 million
people had died by the time the pandemic ended two years later.

Even in today's interconnected world, it's difficult to imagine such a deadly global
disease. But the question isn't whether or not a new pandemic will occur; it's when
and how severe it will be. COVID-19, Ebola, Zika, and Lyme disease are all potential
pandemics. A strain that is resistant to antibiotics will spread faster than any other
waterborne disease. Is there a recent example? The Americas experienced Zika
outbreaks in 2015 and 2016. Zika had been reported in 20 countries and territories at
the start of 2016. It had spread to at least 60 people by the end of the outbreak.

4. The spread of communicable diseases

Noncommunicable diseases are the leading cause of death worldwide, and the threat
is growing. Chronic diseases, such as heart disease, respiratory disease, and diabetes,
already account for more than 70% of all deaths each year. In 2018, that amounted to
41 million people, which was more than Canada's entire population. More than one-
third of these deaths occurred in people aged 30 to 69. The majority of NCD deaths
occur in low- and middle-income countries, where health education is scarce and
quality treatment and care can be difficult to come by.

NCDs know no bounds. Tobacco use, physical inactivity, alcohol use, unhealthy diets,
and air pollution are all major risk factors for children, adults, and the elderly. These
risk factors have also been shown to exacerbate mental health issues, which
frequently begin at a young age and go unnoticed and untreated; suicide is the second-
leading cause of death among people aged 15 to 29.

5. Humanitarian disasters
In places like Yemen, Venezuela, and Syria, an unprecedented number of people are
suffering as a result of humanitarian crises. Last year, conflict and disaster displaced a
record number of people, exposing millions of families to an increased risk of
malnutrition and infectious diseases such as cholera. According to the United Nations
Office for the Coordination of Humanitarian Affairs, conflicts, climate change, and
economic stress will push millions more into a humanitarian crisis in the coming
years.
In these fragile contexts, health systems are overwhelmed, and hospitals are in dire
conditions, with few to no supplies, equipment, or electricity, and insufficient health
workers to meet the never-ending needs. This is something that has been witnessed
firsthand in Asia and Latin America. In Yemen, hospitals lack medicine, supplies, and
qualified personnel in communities where malnutrition and disease are prevalent.
Families in Venezuela have travelled long distances and crossed the border to access
urgent health services that they could not find (or afford) in Venezuela.

Health resources can be increased by increasing government revenues through

effective tax collection and combating tax evasion. Rich countries generate more
revenue as a share of GDP, with taxes accounting for the majority of their domestic
revenue. Tax collection systems in poorer countries are weaker. The tax represents
less than 15% of GDP in roughly half of the low and low-middle-income countries.

Several countries, including Burkina Faso, Kenya, and Senegal, have fully utilized
their tax collection capacity, and any additional efforts in this area are unlikely to
result in additional health financing. Health-related taxes can also be levied. Djibouti
and Guatemala, for example, direct tobacco tax revenue to health. Economists argue
that earmarking tax revenue for health does not necessarily result in increased health
budgets; instead, governments may simply reduce health funding from other sources
of revenue.

Tax avoidance strategies, such as base erosion and profit shifting, tax breaks for
corporations, and corruption all undermine developing countries' ability to collect
taxes. There is little evidence that tax breaks and credits lead to increased foreign
investment. Tax breaks, with the exception of a few exceptions, result in revenue
losses.

The IMF suggests establishing revenue targets and broadening the tax base. While
income and value-added taxes are major sources of revenue in the developed world,
the grey economy of developing countries results in missed revenue collection
opportunities.

Finally, the Philippines' experience between 2012 and 2016 is one of the most
compelling examples of bold national tobacco tax reform. It entailed a fundamental
reorganization of the country's tobacco excise tax structure as well as significant tax
increases. This increased the number of families enrolled in a health insurance scheme
from 5.2 million in 2012 to 15.3 million in 2015.

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