10 ms·

The world is becoming less welcoming to tax dodgers

71 points by olliepop 11y ago

vixen99 11y ago
Let's be careful with terms. Dodging is avoiding - generally thought to be a sensible activity. 'No man in the country is under the smallest obligation, moral or other, so to arrange his legal relations to his business or property as to enable the Inland Revenue to put the largest possible shovel in his stores. The Inland Revenue is not slow, and quite rightly, to take every advantage which is open to it under the Taxing Statutes for the purposes of depleting the taxpayer's pocket. And the taxpayer is in like manner entitled to be astute to prevent, so far as he honestly can, the depletion of his means by the Inland Revenue' Lord Clyde: Ayrshire Pullman Motor Services v Inland Revenue [1929] 14 Tax Case 754, at 763,764:
- sageikosa 11y ago
  Tax exposure abatement!
- DanBC 11y ago
  Sure, everyone is happy with normal tax planning. But some of these tax avoidance schemes are only legal because tax authorities do not have the number of staff needed to investigate and prosecute all of them. They use weird loopholes (which get closed, and which sometimes require repayment of unpaid tax) and bizarre corporate structures which only exist to avoid tax. Tax avoidance has changed its meaning from normal tax planning to become that gray not-yet-regulated area near outright tax evasion.
  - junto 11y ago
    If they really wanted to close these loopholes they would. Politicians only push them to be closed whilst a) the companies in question aren't lining their pockets, and b) the politicians start to lose votes because of it.
    - rbcgerard 11y ago
      I think that that for every "loophole", separating the legitimate and illegitimate users (however you wish to define those) objectively is next to impossible.
    - asift 11y ago
      While I think there is truth to your point, it's also true that some loopholes are the result of unintended consequences rather than conscious creation. In these instances, there will still be companies lobbying to keep these loopholes open, but the government can still fail at closing loopholes even when they are explicitly trying to close them.
      - junto 11y ago
        Indeed, many loopholes are due to the fact that taxes are national whist companies are global.
  - LordKano 11y ago
    But some of these tax avoidance schemes are only legal because tax authorities do not have the number of staff needed to investigate and prosecute all of them. There is a difference between something that is legal and something that is illegal but difficult to prove. You seem to be conflating the two issues. They use weird loopholes (which get closed, and which sometimes require repayment of unpaid tax) and bizarre corporate structures which only exist to avoid tax. If tax law were not so onerous and burdensome, there would be no incentive to crease these corporate structures and to manage business in such a way. There is nothing legally or morally objectionable about using the rules, written by your adversary, to your own advantage.
    - joosters 11y ago
      But tax laws have to become more and more onerous in order to close each loophole... it's a self-fulfilling prophecy.
      - jpgvm 11y ago
        Not entirely true. Tax laws have loopholes because exceptions were made. If there were no exceptions there would be no loopholes. So the real goal should be instead of trying to patch the infinite number of loopholes created by ever increasing complexity is to throw it all out and come up with a simple ruleset that applies to everyone and everything with no exceptions.
        derekp7 11y ago
        Let's try on an example: All revenue is taxed at 20%. Now this will work for some businesses, as the cost to make the product is low enough, and the sale price high enough, that 20% can be paid and there is still profit left over. But then there are very low margin, high volume businesses. They may have only a marginal profit per unit sold due to the nature of what they are selling, leaving no room for 20% tax. So we add in an exception that says "You can deduct from revenue the cost of goods sold" (i.e., tax on net instead of gross). Now all the business has to do is find ways of hiding profit in the cost of goods sold. Then there are products which contain materials that changed hands many times before it got to the final product. So if a raw material (lets say, cotton) is the majority expense, it has to go to one company to refine it, a second company to turn it into thread, a third to add color, a fourth to make it into fabric, and finally a fifth company to make a shirt. So that cotton gets taxed 5 times before it gets sold to the end consumer. So let's add another exception, that goods sold for use in making another product aren't taxed -- that way, large businesses that produce the entire vertical stack in-house don't have an unfair tax advantage against smaller companies. Gee, now we have another loophole that can be creatively exploited.
  - gizi 11y ago
    Concerning "normal tax planning", there is no definition for the term "normal tax planning" for which we could implement a function that returns a yes or a no. In other words, the term "normal tax planning" would never appear in any policy document. The tax code is already arbitrary enough as it stands.
    - rbcgerard 11y ago
      What many forget, but is fairly straightforward, is that tax planning is usually performed by accountants and lawyers at an hourly rate and is largely disconnected from the sum involved. Therefore the ROI of tax planning increases dramatically with larger sums. i.e. spend $50k to setup some complex structure to save $60k in taxes? no thanks, spend $75k to save $1m? i'm listening...
- gozo 11y ago
  Someone always feels the need to point that out. That isn't the point here though. A lot of these offshore jurisdictions are used for dirty money from Russia, China and the Middle East. The reason the US has become a lot harder on offshore jurisdictions isn't primarily because of tax reasons, as illustrated by continued existence of the loophole used by large tech companies, but to give more power to the NSA to prevent terrorism financing and conduct other forms of intelligence, like industrial espionage. That's also why they spied on SWIFT transactions and why they don't care that the US itself is secretive.
  - JoshTriplett 11y ago
    > The reason the US has become a lot harder on offshore jurisdictions isn't primarily because of tax reasons, as illustrated by continued existence of the loophole used by large tech companies, but to give more power to the NSA to prevent terrorism financing and conduct other forms of intelligence, like industrial espionage. That's the stated reason behind "know your customer" laws and international pressures to enact the same. However, once you have the information, nothing requires that it only serve that purpose...
- noja 11y ago
  https://www.youtube.com/watch?v=m2q-Csk-ktc https://www.youtube.com/watch?v=m2q-Csk-ktc
- branchless 11y ago
  Would someone in 1929 have conceived international tax havens, shell companies and modern creative accounting? If he had, would he have approved? I doubt it.
  - KaiserPro 11y ago
    They had been around for a while, and had been legally tested... The U.K. passed legislation in 1925 that made it easier for individuals to use trusts to keep their financial affairs under wraps. Four years later, London courts ruled that Egyptian Delta Land and Investment Co. Ltd., which was registered in London and headquartered in Cairo, did not have to pay tax in the U.K., setting a precedent for future tax avoidance.[1] [1]http://www.bloomberg.com/news/articles/2013-05-03/offshore-tax-havens-in-spotlight-after-200-year-history http://www.bloomberg.com/news/articles/2013-05-03/offshore-t...
    - branchless 11y ago
      Taking any lead from the UK for guidance on right and wrong is a bad idea. It's a rentier paradise. The UK establishment love not paying their way. Again I doubt the person quoted envisaged shell companies for avoiding tax across international borders when they are in fact based in the country they are avoiding tax and using the infrastructure.
- mfringel 11y ago
  [IANAUKTL] That would appear to run directly up against the Ramsay Principle.[1] Specifically, if a company does a series of pre-ordained business transactions with no commercial purpose, specifically with the goal of reducing their tax burden, Inland Revenue can look at the whole transaction and assess payment based on what would have happened otherwise. A similar case happened in the US with Gregory v. Helvering[2], with the out-of-context quote from Judge Learned Hand in the predecessor case (Helvering v. Gregory[3]) saying roughly the same thing as Lord Clyde. [1] https://en.wikipedia.org/wiki/Ramsay_principle https://en.wikipedia.org/wiki/Ramsay_principle [2] https://en.wikipedia.org/wiki/Gregory_v._Helvering https://en.wikipedia.org/wiki/Gregory_v._Helvering [3] http://www.leagle.com/decision/193487869F2d809_1591/HELVERING%20v.%20GREGORY http://www.leagle.com/decision/193487869F2d809_1591/HELVERIN...
  - AnthonyMouse 11y ago
    The Ramsay Principle requires there to be no commercial purpose. But "commercial purpose" is so broad that you can fall into it without even trying.
- Marazan 11y ago
  Funny how you don't quote the Ramsey Principle which comes decades after Pullman Motor Services and thus has primacy.
Chrossler 11y ago
I don't like taxes either... That's why i just don't pay them
- JonFish85 11y ago
  You work for Uber/Airbnb, don't you :)
klausjensen 11y ago
Link to the underlying report, this story is based on: http://www.financialsecrecyindex.com/introduction/fsi-2015-results http://www.financialsecrecyindex.com/introduction/fsi-2015-r... ...Something I think the journalists should have done in the story, btw.
- iheartmemcache 11y ago
  If I could give you more than one upvote I would. The raw data is always important, and the whole "we'll release the data in december" stuff is sketchy (maybe it's an intentional press embargo to drum up publicity?). It seems like the members of the organization are reputable academics, but I'll wait for the professionals to come in and perform actual analysis. If you putz around with their servers, you can get access to their 'source' material: http://www.financialsecrecyindex.com/database/USA.xml http://www.financialsecrecyindex.com/database/USA.xml insert any given country + xml, you should be fine. I have an archive I just wget'ed that I'll SCP to one of my servers in a bit.
lumberjack 11y ago
The reason being? My guess is governments are finding it hard to balance their budgets since many economies are performing short of what they predicted pre-2008.
- josefresco 11y ago
  From the article "The reason for the shift is the global, austerity-era push for countries to share more information on tax arrangements. "
  - asift 11y ago
    We live in an "austerity-era" where government budgets continually expand. Apparently a mere reduction in the rate of growth qualifies as austerity these days.
    - drumdance 11y ago
      It's more about spending relative to GDP. And when you look at income relative to GPD, the US is only just now returning to it's historical average in eighties and nineties. http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=205 http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Doc...
gtpasqual 11y ago
Sorry to break it to you, but tax evasion will always exist. There is a HUGE financial incentive to find alternatives and a simple example would be cryptocurrencies.
comrh 11y ago
Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take advantage of the system then end up not paying their fair share?
- mathgeek 11y ago
  While it is essentially a zero-sum game, there are many alternatives to "make up that revenue." Those include printing money, reducing expenditures, etc.
  - deleted 11y ago
    [deleted]
- jacquesm 11y ago
  That's pretty much how it is, though with the way some governments work chances are that it would just lead to more squandered money and no reduced taxes for the ones making up the deficit. I've yet to hear of substantial tax decreases that were not carefully designed to be 'neutral' for the taxman. Every decrease in one tax was always offset by an increase in another or an entirely new tax.
- deleted 11y ago
  [deleted]
- fleitz 11y ago
  Not at all, taxes should be used to make investments in the economy where the market fails, a government that spends wisely will grow its economy and thus its tax revenue without changing rates. A tax dodge is not unlike a government with lower tax rates. If the taxes not paid creates increased growth then tax will simply be made up in the future. Imagine two countries each with a $1000 economy, both have a 50% tax rate, but in one country every person 'dodges' 50% of their taxes, if that country grows its economy at say 3% instead of 2% then after 100 years two economies will be at $7,386.22, $20,068.17 thus the country with the tax dodgers will collect ~$5K in revenue while the other collects ~$3.5K
- 11y ago
jensen123 11y ago
I have an old book here - The International Man by Doug Casey, which was published in 1978. It lists the tax rates for several countries. For example, the income tax went up to 75% in Japan, 71% in the Netherlands, 70% in Norway, 55% in Singapore, 80% in Sweden, 83% in the UK, 70% in the US and 56% in West-Germany. I'm wondering if maybe there might be a correlation between unreasonably high taxes and tax havens? If the tax rate is reasonable, say 20-30%, then I probably won't bother trying to evade taxes myself and I won't have much sympathy with others doing it (greedy assholes!). However, if the tax rate is like 70-80%, then yeah, putting some money in a tax haven becomes tempting and I will have much sympathy with other tax dodgers.
- lhc- 11y ago
  The US tax rates are vastly lower than that, and we still have enormous amounts of tax evasion (legal and illegal). Looking at the language from much of the US's rich, and they're basically stating that any tax is too much, so I'm not sure there's a rate you could charge that will be sufficiently low to encourage civic responsibility from those who think they should not pay any taxes for anything.
  - vlehto 11y ago
    Same with rent and the poor, they always complain. Does this mean that any rent control mechanism is unnecessary?
  - SeoxyS 11y ago
    The US tax rate is hardly lower… if you live in San Francisco and are in the top bracket, you pay 50%+ tax rate if you don't make an effort to minimize (aka dodge) your exposure.
    - ThomPete 11y ago
      And so many of those benefit from getting access to capital gains instead if they get stock which many who are in the top bracket do.
    - 11y ago
fleitz 11y ago
Here in Canada even the Revenue Agency dodges taxes. http://www.cbc.ca/news/politics/federal-pension-board-used-offshore-scheme-to-skirt-foreign-taxes-1.2824959 http://www.cbc.ca/news/politics/federal-pension-board-used-o...
snake_plissken 11y ago
I read an interesting piece the other day. It posited that the true goal of mass data collection programs like those run by the NSA and GCHQ is not to stop terrorism but to gather information and track financial transactions so that more taxes could be collected. I think the only piece of evidence supporting the supposition was the fact that the data will be kept "forever", so it wasn't the most convincing piece, but I liked the unorthodox nature of the idea. I think it was on ZeroHedge but I can't find it at the moment.
eip 11y ago
"When the government is able to collect tax and seize private property without just compensation, it is an indication that the public is ripe for surrender and is consenting to enslavement and legal encroachment. A good and easily quantified indicator of harvest time is the number of public citizens who pay income tax despite an obvious lack of reciprocal or honest service from the government."

71 points by olliepop 11y ago

Let's be careful with terms. Dodging is avoiding - generally thought to be a sensible activity. 'No man in the country is under the smallest obligation, moral or other, so to arrange his legal relations to his business or property as to enable the Inland Revenue to put the largest possible shovel in his stores. The Inland Revenue is not slow, and quite rightly, to take every advantage which is open to it under the Taxing Statutes for the purposes of depleting the taxpayer's pocket. And the taxpayer is in like manner entitled to be astute to prevent, so far as he honestly can, the depletion of his means by the Inland Revenue' Lord Clyde: Ayrshire Pullman Motor Services v Inland Revenue [1929] 14 Tax Case 754, at 763,764:

sageikosa 11y ago
Tax exposure abatement!
DanBC 11y ago
Sure, everyone is happy with normal tax planning. But some of these tax avoidance schemes are only legal because tax authorities do not have the number of staff needed to investigate and prosecute all of them. They use weird loopholes (which get closed, and which sometimes require repayment of unpaid tax) and bizarre corporate structures which only exist to avoid tax. Tax avoidance has changed its meaning from normal tax planning to become that gray not-yet-regulated area near outright tax evasion.
- junto 11y ago
  If they really wanted to close these loopholes they would. Politicians only push them to be closed whilst a) the companies in question aren't lining their pockets, and b) the politicians start to lose votes because of it.
  - rbcgerard 11y ago
    I think that that for every "loophole", separating the legitimate and illegitimate users (however you wish to define those) objectively is next to impossible.
  - asift 11y ago
    While I think there is truth to your point, it's also true that some loopholes are the result of unintended consequences rather than conscious creation. In these instances, there will still be companies lobbying to keep these loopholes open, but the government can still fail at closing loopholes even when they are explicitly trying to close them.
    - junto 11y ago
      Indeed, many loopholes are due to the fact that taxes are national whist companies are global.
- LordKano 11y ago
  But some of these tax avoidance schemes are only legal because tax authorities do not have the number of staff needed to investigate and prosecute all of them. There is a difference between something that is legal and something that is illegal but difficult to prove. You seem to be conflating the two issues. They use weird loopholes (which get closed, and which sometimes require repayment of unpaid tax) and bizarre corporate structures which only exist to avoid tax. If tax law were not so onerous and burdensome, there would be no incentive to crease these corporate structures and to manage business in such a way. There is nothing legally or morally objectionable about using the rules, written by your adversary, to your own advantage.
  - joosters 11y ago
    But tax laws have to become more and more onerous in order to close each loophole... it's a self-fulfilling prophecy.
    - jpgvm 11y ago
      Not entirely true. Tax laws have loopholes because exceptions were made. If there were no exceptions there would be no loopholes. So the real goal should be instead of trying to patch the infinite number of loopholes created by ever increasing complexity is to throw it all out and come up with a simple ruleset that applies to everyone and everything with no exceptions.
      - derekp7 11y ago
        Let's try on an example: All revenue is taxed at 20%. Now this will work for some businesses, as the cost to make the product is low enough, and the sale price high enough, that 20% can be paid and there is still profit left over. But then there are very low margin, high volume businesses. They may have only a marginal profit per unit sold due to the nature of what they are selling, leaving no room for 20% tax. So we add in an exception that says "You can deduct from revenue the cost of goods sold" (i.e., tax on net instead of gross). Now all the business has to do is find ways of hiding profit in the cost of goods sold. Then there are products which contain materials that changed hands many times before it got to the final product. So if a raw material (lets say, cotton) is the majority expense, it has to go to one company to refine it, a second company to turn it into thread, a third to add color, a fourth to make it into fabric, and finally a fifth company to make a shirt. So that cotton gets taxed 5 times before it gets sold to the end consumer. So let's add another exception, that goods sold for use in making another product aren't taxed -- that way, large businesses that produce the entire vertical stack in-house don't have an unfair tax advantage against smaller companies. Gee, now we have another loophole that can be creatively exploited.
- gizi 11y ago
  Concerning "normal tax planning", there is no definition for the term "normal tax planning" for which we could implement a function that returns a yes or a no. In other words, the term "normal tax planning" would never appear in any policy document. The tax code is already arbitrary enough as it stands.
  - rbcgerard 11y ago
    What many forget, but is fairly straightforward, is that tax planning is usually performed by accountants and lawyers at an hourly rate and is largely disconnected from the sum involved. Therefore the ROI of tax planning increases dramatically with larger sums. i.e. spend $50k to setup some complex structure to save $60k in taxes? no thanks, spend $75k to save $1m? i'm listening...
gozo 11y ago
Someone always feels the need to point that out. That isn't the point here though. A lot of these offshore jurisdictions are used for dirty money from Russia, China and the Middle East. The reason the US has become a lot harder on offshore jurisdictions isn't primarily because of tax reasons, as illustrated by continued existence of the loophole used by large tech companies, but to give more power to the NSA to prevent terrorism financing and conduct other forms of intelligence, like industrial espionage. That's also why they spied on SWIFT transactions and why they don't care that the US itself is secretive.
- JoshTriplett 11y ago
  > The reason the US has become a lot harder on offshore jurisdictions isn't primarily because of tax reasons, as illustrated by continued existence of the loophole used by large tech companies, but to give more power to the NSA to prevent terrorism financing and conduct other forms of intelligence, like industrial espionage. That's the stated reason behind "know your customer" laws and international pressures to enact the same. However, once you have the information, nothing requires that it only serve that purpose...
noja 11y ago
https://www.youtube.com/watch?v=m2q-Csk-ktc https://www.youtube.com/watch?v=m2q-Csk-ktc
branchless 11y ago
Would someone in 1929 have conceived international tax havens, shell companies and modern creative accounting? If he had, would he have approved? I doubt it.
- KaiserPro 11y ago
  They had been around for a while, and had been legally tested... The U.K. passed legislation in 1925 that made it easier for individuals to use trusts to keep their financial affairs under wraps. Four years later, London courts ruled that Egyptian Delta Land and Investment Co. Ltd., which was registered in London and headquartered in Cairo, did not have to pay tax in the U.K., setting a precedent for future tax avoidance.[1] [1]http://www.bloomberg.com/news/articles/2013-05-03/offshore-tax-havens-in-spotlight-after-200-year-history http://www.bloomberg.com/news/articles/2013-05-03/offshore-t...
  - branchless 11y ago
    Taking any lead from the UK for guidance on right and wrong is a bad idea. It's a rentier paradise. The UK establishment love not paying their way. Again I doubt the person quoted envisaged shell companies for avoiding tax across international borders when they are in fact based in the country they are avoiding tax and using the infrastructure.
mfringel 11y ago
[IANAUKTL] That would appear to run directly up against the Ramsay Principle.[1] Specifically, if a company does a series of pre-ordained business transactions with no commercial purpose, specifically with the goal of reducing their tax burden, Inland Revenue can look at the whole transaction and assess payment based on what would have happened otherwise. A similar case happened in the US with Gregory v. Helvering[2], with the out-of-context quote from Judge Learned Hand in the predecessor case (Helvering v. Gregory[3]) saying roughly the same thing as Lord Clyde. [1] https://en.wikipedia.org/wiki/Ramsay_principle https://en.wikipedia.org/wiki/Ramsay_principle [2] https://en.wikipedia.org/wiki/Gregory_v._Helvering https://en.wikipedia.org/wiki/Gregory_v._Helvering [3] http://www.leagle.com/decision/193487869F2d809_1591/HELVERING%20v.%20GREGORY http://www.leagle.com/decision/193487869F2d809_1591/HELVERIN...
- AnthonyMouse 11y ago
  The Ramsay Principle requires there to be no commercial purpose. But "commercial purpose" is so broad that you can fall into it without even trying.
Marazan 11y ago
Funny how you don't quote the Ramsey Principle which comes decades after Pullman Motor Services and thus has primacy.

Chrossler 11y ago

I don't like taxes either... That's why i just don't pay them

JonFish85 11y ago
You work for Uber/Airbnb, don't you :)

klausjensen 11y ago

Link to the underlying report, this story is based on: http://www.financialsecrecyindex.com/introduction/fsi-2015-results http://www.financialsecrecyindex.com/introduction/fsi-2015-r... ...Something I think the journalists should have done in the story, btw.

iheartmemcache 11y ago
If I could give you more than one upvote I would. The raw data is always important, and the whole "we'll release the data in december" stuff is sketchy (maybe it's an intentional press embargo to drum up publicity?). It seems like the members of the organization are reputable academics, but I'll wait for the professionals to come in and perform actual analysis. If you putz around with their servers, you can get access to their 'source' material: http://www.financialsecrecyindex.com/database/USA.xml http://www.financialsecrecyindex.com/database/USA.xml insert any given country + xml, you should be fine. I have an archive I just wget'ed that I'll SCP to one of my servers in a bit.

lumberjack 11y ago

The reason being? My guess is governments are finding it hard to balance their budgets since many economies are performing short of what they predicted pre-2008.

josefresco 11y ago
From the article "The reason for the shift is the global, austerity-era push for countries to share more information on tax arrangements. "
- asift 11y ago
  We live in an "austerity-era" where government budgets continually expand. Apparently a mere reduction in the rate of growth qualifies as austerity these days.
  - drumdance 11y ago
    It's more about spending relative to GDP. And when you look at income relative to GPD, the US is only just now returning to it's historical average in eighties and nineties. http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=205 http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Doc...

gtpasqual 11y ago

Sorry to break it to you, but tax evasion will always exist. There is a HUGE financial incentive to find alternatives and a simple example would be cryptocurrencies.

comrh 11y ago

Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take advantage of the system then end up not paying their fair share?

mathgeek 11y ago
While it is essentially a zero-sum game, there are many alternatives to "make up that revenue." Those include printing money, reducing expenditures, etc.
- deleted 11y ago
  [deleted]
jacquesm 11y ago
That's pretty much how it is, though with the way some governments work chances are that it would just lead to more squandered money and no reduced taxes for the ones making up the deficit. I've yet to hear of substantial tax decreases that were not carefully designed to be 'neutral' for the taxman. Every decrease in one tax was always offset by an increase in another or an entirely new tax.
deleted 11y ago
[deleted]
fleitz 11y ago
Not at all, taxes should be used to make investments in the economy where the market fails, a government that spends wisely will grow its economy and thus its tax revenue without changing rates. A tax dodge is not unlike a government with lower tax rates. If the taxes not paid creates increased growth then tax will simply be made up in the future. Imagine two countries each with a $1000 economy, both have a 50% tax rate, but in one country every person 'dodges' 50% of their taxes, if that country grows its economy at say 3% instead of 2% then after 100 years two economies will be at $7,386.22, $20,068.17 thus the country with the tax dodgers will collect ~$5K in revenue while the other collects ~$3.5K
11y ago

jensen123 11y ago

I have an old book here - The International Man by Doug Casey, which was published in 1978. It lists the tax rates for several countries. For example, the income tax went up to 75% in Japan, 71% in the Netherlands, 70% in Norway, 55% in Singapore, 80% in Sweden, 83% in the UK, 70% in the US and 56% in West-Germany. I'm wondering if maybe there might be a correlation between unreasonably high taxes and tax havens? If the tax rate is reasonable, say 20-30%, then I probably won't bother trying to evade taxes myself and I won't have much sympathy with others doing it (greedy assholes!). However, if the tax rate is like 70-80%, then yeah, putting some money in a tax haven becomes tempting and I will have much sympathy with other tax dodgers.

lhc- 11y ago
The US tax rates are vastly lower than that, and we still have enormous amounts of tax evasion (legal and illegal). Looking at the language from much of the US's rich, and they're basically stating that any tax is too much, so I'm not sure there's a rate you could charge that will be sufficiently low to encourage civic responsibility from those who think they should not pay any taxes for anything.
- vlehto 11y ago
  Same with rent and the poor, they always complain. Does this mean that any rent control mechanism is unnecessary?
- SeoxyS 11y ago
  The US tax rate is hardly lower… if you live in San Francisco and are in the top bracket, you pay 50%+ tax rate if you don't make an effort to minimize (aka dodge) your exposure.
  - ThomPete 11y ago
    And so many of those benefit from getting access to capital gains instead if they get stock which many who are in the top bracket do.
  - 11y ago

fleitz 11y ago

Here in Canada even the Revenue Agency dodges taxes. http://www.cbc.ca/news/politics/federal-pension-board-used-offshore-scheme-to-skirt-foreign-taxes-1.2824959 http://www.cbc.ca/news/politics/federal-pension-board-used-o...

snake_plissken 11y ago

I read an interesting piece the other day. It posited that the true goal of mass data collection programs like those run by the NSA and GCHQ is not to stop terrorism but to gather information and track financial transactions so that more taxes could be collected. I think the only piece of evidence supporting the supposition was the fact that the data will be kept "forever", so it wasn't the most convincing piece, but I liked the unorthodox nature of the idea. I think it was on ZeroHedge but I can't find it at the moment.

eip 11y ago

"When the government is able to collect tax and seize private property without just compensation, it is an indication that the public is ripe for surrender and is consenting to enslavement and legal encroachment. A good and easily quantified indicator of harvest time is the number of public citizens who pay income tax despite an obvious lack of reciprocal or honest service from the government."