A/HRC/40/57 and expenditure variations should be evaluated in terms of the associated outcomes for economic growth, human rights and long-term debt sustainability. 11.3 Decisions on fiscal policy should not result in expenditure cuts that curtail the guarantee of rights, mainly in sectors such as education, health and social insurance − particularly important for women, children and persons with disabilities − or in deepening social or economic inequality and poverty through indirect and regressive taxes, such as value added tax. 11.4 Direct and progressive taxes should be prioritized. Tax policy should promote the redistribution of wealth to overcome the disadvantaged situation of the population in situations of social vulnerability (the poor, minorities and women, among others) and other priority care groups, notably older adults, children and persons with disabilities. 11.5 Tax reform measures include, for example, taxing higher-income categories and wealth more strongly; taxing certain financial transactions; shoring up the tax base; and enhancing tax collection, the efficiency of the tax administration and the fight against tax evasion and avoidance. International, binational or regional regulation is crucial for efficiency in combating evasion, avoidance, tax fraud and illicit financial flows. All States should support global norms and agreements to prevent international tax avoidance and evasion. In this regard, it is necessary that Automatic Exchange of Financial Account Information agreements be effective in order to acknowledge the final beneficiary of a transaction and establish responsibilities in cases of loss of useful resources needed to guarantee rights. Full participation and access to such information to all countries should be ensured.17 11.6 Decision-making processes around tax and fiscal policies need to be open to genuine public debate informed by processes of inclusive, broad, transparent and deliberative social dialogue, which should include a wide range of economic theory and evidence, expressed in language accessible to the public. These provisions also apply to tax exemptions (including tax exclusions, deductions, credits, concessions, preferential rates or deferral of tax liabilities), which reduce the public revenues that can be accrued from taxes. 11.7 Central banks are State institutions and, as such, they are obliged to comply with international human rights law and standards. Inflation and employment targets, among other targets, need to be in line with the State’s human rights obligations in order to avoid any impermissible retrogressive measures. 11.8 Authorities that coordinate massive responses that stabilize the financial sector as well as those which opt for doing little to address a sovereign debt crisis need to demonstrate if and to what extent their strategies would help protect and respect human rights. 11.9 Accumulation of foreign reserves and restrictions on short-term capital inflows and outflows can often be considered effective monetary policies. However, massive accumulation of foreign reserves beyond those recommended in the rules of international financial institutions, leading to large unutilized amounts of reserves accumulated in central banks, should be balanced against the immediate needs of the State, especially from a social investment and human rights perspective. On the other hand, limiting speculative financial movements may open up space to pursue policies to facilitate the realization of human rights. 11.10 States should have a transparent and democratically discussed bailout and interest rate formation regime established by law. States should use a mix of tools to ensure appropriate global and domestic financial market regulation with the aim of curbing excessive credit growth. This mix should include measures of prudential regulation, debt sustainability analysis and capital controls. 18 17 18 12 See A/HRC/31/61. See A/HRC/31/60.