I am at a conference at the World Bank on tax and development today and tomorrow.
Jan Walliser, Vice President, Equitable Growth, World Bank, has said this morning that aggressive tax planning by multinational corporations and high net worth individuals puts them in a state of tax war with developing countries. And he argues as a result that those countries suffer a cost of at least US$100 billion a year - a sum broadly equivalent to world aid to those countries.
It has taken a long time to get such agreement, bith on the language and on the sum involved.
This is progress.
And delivering country-by-country reporting to these countries and the capacity to use it was identified as a key solution by the World Bank.
I welcome that.
But I want delivery.
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
Historically, when extremes of this kind have occurred, often in one Empire of the past or another, the elites in question often manage to self destruct or to provoke elimination either internally or by outsiders. Where they possessed actual gold, silver or other hard money, property and goods, some redistribution might occur albeit after serious disruption. Given that much of our present money and asset base is not of this kind a collapse of the present elite is all too likely to take the rest of us with them. If we cannot tax them or spread the money and asset base soon the risks are increasing.
And the results demonstrate that the UK is now a more unequal country than any time since the 1930’s!
This is yet another creeping blow for social “progress” in any sense of the word.
http://www.thecanary.co/2016/05/23/david-cameron-just-broke-a-new-record-and-its-utterly-shameful/
Presumably there is a line crossed when we go from tax competition to tax warfare. What is that line, and when was it crossed? I think Jan Walliser needs to explain himself better.
Certainly if countries set their corporation tax at the correct rate which rhymes with zero, then this is a ‘war’ that could be ended, but that would mean less well paid work for NGOs and accountants.
Oh come on: the world is not that polar. There are many shades of grey
What is fundamentally clear is the correct rate of Ct is not zero, and is a long way from it
In that case cooperation is Pareto optimal, even for states that now choose zero (many of whom struggle as a result)
The line is clear: it is where an act prevents another state collecting the tax due to it,nwh ether they know it is due or not
All corporate profits will become someone’s income if you wait long enough. At that point it can be taxed.
The people who want non-zero corporation taxes are probably those with accountancy qualifications and NGO grants who relish in having work to do for wealthy clients. They don’t care for small and new businesses where the price of business advice and accountancy services have been artificially raised with an impact on mobility and inequality.
Oddly enough those of us who care about tax being paid at the right time think waiting long enough is inappropriate, not least because by then it may also be a capital gain
So respectfully it is not accountants and NGOs who want this. It is governments
And they do so because they know that it is their duty to provide a level playing field to all taxpayers. These concepts, like justice, seem to pass you by. Why is that?