The report illustrates the risk of corruption driven by powerful interest groups in the process of designing and granting tax incentives.
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The rapid rise of online political campaigning has made most political financing regulations obsolete, putting transparency and accountability at risk.
Digital advertising has obscured who is behind an ad, how much the ad costs and whose money is paying for the ad. In too many countries, virtually any internet user with a credit card can pay to promote political content and circumvent laws. Worse, domestic or foreign actors can invest financial resources in inauthentic behaviour – through bots or fake accounts – to amplify divisive political messages or advance illegitimate interests.
The finance of online political advertising is hard to scrutinise. In the absence of regulation advertising volumes might be unlimited, allowing opaque cash to flow into digital spending.
Parties and candidates can micro target their online ads to very narrow groups of voters, excluding others from public deliberation. The same ads can spread untruths and misinformation. This use of digital ads weakens the accountability of politicians and erodes the legitimacy of power.
Online political advertising could be advantageous too. It opens up opportunities to reach out and connect to voters. Different groups of constituents can use it to bring their own voice to public deliberation. If used strategically, it can help emerging politicians with fewer resources to take advantage of crowdfunding so they don’t have to heavily rely on wealthy donors.
To realise the full potential of online political advertising it is necessary to first address its transparency and accountability risks. This report identifies five areas for improvement.