As the Guardian reports:

The canton of Obwalden is planning to launch "special living zones" for millionaires in an attempt to boost its tax take by luring the wealthiest residents. Like other cantons in the tax haven, Obwalden finds itself short of revenue because it has been competing with other jurisdictions to see who can offer the lowest rate of tax.

The result has been a drastic shortfall in tax revenues as people set up PO box companies to take advantage of the low rates, while contributing nothing to the local economies because they live elsewhere.

Obwalden's answer is to lift construction bans on land reserved for agricultural use, offering the rich the chance to secure property on protected land, with the promise of spectacular views of lake and alpine landscapes.

There is of course considerable irony in this: like Jersey and Guernsey, Obwalden is heading for bankruptcy because it is offering tax haven tax rates to the wealthy who offer nothing in return. So now they’re actually selling the place — something the Crown Dependencies effectively did long ago when they sold their integrity to the financial services industry.

But, again just as in jersey and Guernsey, there are victims:

The homes would be constructed on land not usually accessible to ordinary citizens, leading to accusations that the policy discriminates against less wealthy inhabitants while rewarding the rich.

"These special living zones are nothing less than a form of apartheid," said Moritz Leuenberger, of the Social Democrats, who is Switzerland's environment and transport minister. "Is a racing car driver of so much more use than a nurse?" he asked, referring to the rich personalities such as Michael Schumacher who have moved to Switzerland to take advantage of its favourable tax laws.

Many argue that the drive to draw in the rich is destroying communities as normal earners are forced out by rising prices.

In other words — as we know, tax havens destroy well-being.

And the myth that they do not is also extraordinarily harmful. The Obwaldeners voted to reduce their taxes three years ago,  bringing corporate tax down to 6.6% and local income tax down to 1.8% in reaction to pressure from its inhabitants — 90% voted in favour of the move in a referendum. And it introduced a flat tax at the same time. as the Guardian notes, the reaction was predictable:

While on paper it appears that 400 new companies moved to the area as a result of the changes, most are nothing more than PO box companies. They fail to offer employment to locals or boost consumer spending in the region.

Quite. There was no Laffer effect. The place was just being used to undermine the regulation and taxes of other places — classic secrecy jurisdiction behaviour.

So what now? The place is going bust: the sooner a few do the quicker this problem will be solved. It is abundantly clear that the Laffer curve is bunkum, flat taxes do not work, tax haven behaviour and low taxes harm ordinary people — so let’s get rid of these places and make clear there is not, never has been and never will be such a thing as beneficial tax competition.