This is a speculative blog based initially on a couple of conversations with people in the industry, with some supporting evidence.
A (slightly tidied-up) conversation we’ve just had went along these lines:
“You’ll never guess what is the new Switzerland for Asia. And I mean big time. The Asian money is heading there. Banks set up there as its a financial centre that doesn’t tax foreigners. And its perceived as safe, and not a signatory to the CRS [The OECD’s Common Reporting Standard.] TAIWAN.”
We’ve pointed to a draft of this before, but here is the final published version, in the British Journal of Politics and International Relations, a paper by two TJNers and Duncan Wigan of the Copenhagen Business School. (It’s also available here.)
The abstract goes like this:
The Global Financial Crisis placed the utility of financial services in question. The crash, great recession, wealth transfers from public to private, austerity and growing inequality cast doubt on the idea that finance is a boon to the host economy. This article systematizes these doubts to highlight the perils of an oversized financial sector. States failing to harness natural resources for development led to the concept of the Resource Curse. In many countries, resource dependence generated slower growth, crowding out, reduced economic diversity, lost entrepreneurialism, unemployment, economic instability, inequality, conflict, rent-seeking and corruption. The Finance Curse produces similar effects, often for similar reasons. Beyond a point, a growing financial sector can do more harm than good. Unlike the Resource Curse, these harms transcend borders. The concept of a Finance Curse starkly illuminates the condition of Britain’s political economy and the character of its relations with the rest of the world.
This builds on the original Finance Curse document from May 2013, based on Shaxson’s and Christensen’s extensive work in mineral-dependent countries and in financial centres.
We will store this permanently in our Finance Curse page.
Actor Greg Wise was so disgusted by the evidence of how HSBC bank helped its clients evade taxes through its Swiss subsidiary, he got angry, very angry indeed. So he turned undercover investigator to expose the disgraceful lack of ethics of the tax dodging industry. As one of the tax dodging adviser explains in the programme: “tax, as I say to all clients, is voluntary. You can choose how much you want to pay. Its pretty much down to your moral barometer.”
Greg brings some levity to a subject — and the video will boil your blood. Watch the programme on Channel 4 at 8 p.m. on Monday 8th February – view the trailer here
Read this to share Greg’s anger about HSBC and the world’s favourite drug cartel.
Earlier this week we blogged a groundbreaking exposé of how US law firms advise on shifting dirty money into the USA. Now we hear that bipartisan legislation is being proposed to help stamp out corruption, money laundering and tax evasion by curbing use of anonymously-owned companies in America. Continue reading “Tax Haven USA: Congress moves to end corporate secrecy”→
One year ago, Tax Justice Network published a blog detailing the ways in which the USA is steadily turning itself into a vortex-shaped hole in the global financial system. Others have picked up on the theme, including The Economist which rightly labelled the USA as “the mega-haven”. Now, according to London’s Evening Standard newspaper, tax advisers at exclusive Rothschild Trust are (nearly, but not quite) joining the bandwagon. Continue reading “Tax Haven USA – part two: Rothschilds (nearly) confirms Tax Justice Network position”→
For a longer read on this kind of thing, try this. And from the same http://artsandhealth.ie/diclofenac/ source as the cartoon, in the context of current news:[/vc_column_text][vc_raw_js]
“The European Commission has today opened up a new chapter in its campaign for fair, efficient and growth-friendly taxation in the EU with new proposals to tackle corporate tax avoidance. The Anti Tax Avoidance Package calls on Member States to take a stronger and more coordinated stance against companies that seek to avoid paying their fair share of tax and to implement the international standards against base erosion and profit shifting.”
Here is the text of a letter of complaint that TJN will be handing in to the European Commission at its office in London this afternoon.
On 23rd January 2016 the UK Chancellor of the Exchequer, George Osborne, tweeted from Davos that the UK Government had struck a deal with Google over its past tax liabilities. The deal was disclosed at the specific request of Google.
TJN is concerned that deals have been secretly struck with by HM Revenue & Customs with other companies which have not been disclosed to the public.
We are therefore calling on the European Commission to investigate the Google deal, and also to investigate other so-called sweetheart deals with multinational companies that have not been publicly disclosed.
This morning Alex Cobham, TJN’s Director of Research, called for public country-by-country reporting, in an interview with the BBC’s flagship Today programme (19:20ish).
“Country-by-country reporting: that was actually a Tax Justice Network proposal, going back to our establishment in 2003; but the key to it is for that information to be public: if tax authorities have it, that helps them. But we need to be able to hold tax authorities to account: to know, for example, if HMRC [the UK tax authority] is treating Google fairly.”
Endnote: we’ve blogged Google twice in the last couple of days: see Prof. Sol Picciotto’s more wonkish blog, and our more sweeping earlier one, looking at the economic illiteracy of the Mayor of London.)
Guest blog from TJN senior adviser Professor Sol Picciotto
The announcement of the deal struck by Google with Her Majesty’s Revenue and Customs (HMRC) has aroused much speculation. The term ‘permanent establishment’ has even been mentioned in some august media outlets, such as the Financial Times. These are waters which have been deliberately muddied, so let’s see if we can clarify what is going on. Continue reading “Taxing Google (and Facebook, Twitter, Uber and the rest)”→
“How ironic—no, how perverse—that the USA, which has been so sanctimonious in its condemnation of Swiss banks, has become the banking secrecy jurisdiction du jour,” wrote Peter A. Cotorceanu, a lawyer at Anaford AG, a Zurich law firm, in a recent legal journal. “That ‘giant sucking sound’ you hear? It is the sound of money rushing to the USA.”
Tax Justice Network and Oxfam are joining together to launch a tax justice and human rights essay competition for legal students and professionals. With tax justice rising up the human rights agenda, we want to hear your ideas on how human rights law can be used in the fight against tax dodging. Continue reading “2016 Tax Justice and Human Rights Essay Competition”→
No, not the Lord Mayor of London, but the Mayor of London, a certain Boris Johnson, who’s frequently tipped to be Britain’s next Prime Minister. Given that Britain is arguably the most important player in the global offshore system, this man’s opinions deserve close scrutiny.
The topic at hand is Google’s tax affairs in the UK, and the UK government’s triumphantwidely derided announcement that Google would be paying an extra £130 million in back taxes over the last 10 years.
What’s Scotland got to do with the plunder of Moldova? We take a look at the ‘Wild West’ of Scottish Limited Partnerships. Also, we discuss the tensions in the EU – is the net finally closing on multinational companies, the tax minimisation deals they’ve been getting from various European countries and the big four accountancy firms who advised them? Just how bad was the sell off of one of Colombia’s most profitable power generation companies? What’s former UK Prime Minister Tony Blair got to do with it? And why’s it been ignored outside Latin America? Also, we talk about the MEP who’s dragging the European Commission through the courts to get access to papers they’d rather we didn’t see. The Tax Justice Network’s John Christensen will eat his hat if they DON’T reveal what MEP Fabio De Masi suspects they will: ‘systematic political backup for a tax avoidance cartel that costs taxpayers in the EU hundreds of billions of dollars annually.’
“when you hear Cameron claiming Britain’s leading the world in tackling corruption, it’s beyond a joke.”
“it is a bad look for the city of London and the UK, we are supposed to be democratic and free of corruption and yet here we are facilitating…you know, we are hosting some of the most egregious and destabilizing corruption you could possibly imagine”
Richard Smith, finance journalist and blogger at Naked Capitalism
“Europe has to change itself…If they want to prevent corrupt capital to flow into the EU they can do this… and it looks like it’s for the benefit of the developed countries to receive proceeds of corruption though they seem not to be corrupt themselves and I think it’s not right.”
Featuring: The Tax Justice Network director John Christensen, Daria Kaleniuk of the Anti-Corruption Action Centre in Ukraine, Finance journalist and writer Ian Fraser @IanFraser, and finance journalist and blogger at Naked Capitalism Richard Smith @ncsmiff
Produced and presented by @Naomi_Fowler for the Tax Justice Network. You can follow @TheTaxcast on twitter and subscribe to the Taxcast either on our youtube channel or email naomi[at]taxjustice.net. Also available on iTunes.
Europe must impose withholding taxes on payments, to target U.S. and other tax havens
Global transparency scheme in peril: strong action now needed
The Tax Justice Network is calling for the European Union to follow the United States in imposing a withholding tax against jurisdictions that do not meet new standards of tax transparency – starting with the United States itself.
“This new volume from the AERC (African Economic Research Consortium) is a very welcome milestone in scholarship on the complex and contested areas of capital flight and illicit financial flows (IFF). It is more than that however. It is a powerful book in terms of what it represents; what it contributes; and above all, of what it challenges. These are discussed in turn below, before consideration of a major policy opportunity that now beckons.”
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This is a speculative blog based initially on a couple of conversations with people in the industry, with some supporting evidence.
