onsdag 8 april 2009

More from the Tax Justice Network

"We get the same comments repeated from the same commenter: that land value taxes are the only way forward, and forget all the other taxes. As usual, we disagree: land value taxes have a role, but only as part of a broader tax system."

To which my response is that if TJN will not make the point itself, it will inevitably get these comments, and repeatedly - taxes tied to real estate are not avoidable.

Of what other taxes can this be said? There is a good case for taxes on, say, strong alcoholic drinks but these get avoided through booze cruises, which have the advantage for non-boozers that they help keep the fares down eg in the Baltic and Scandinavia. Guess why so many of the Baltic ferries are registered in Mariehamn? Where the f*** is Mariehamn? Quite.

And a multi national organisation can so easily make profits pop up in one place rather than another.

If the problem of tax avoidance through the use of tax havens is to be cracked, the lion's share of public revenue must come from taxes tied to something that cannot be moved. It surely takes no sophistication to appreciate the force of this argument.

As for these "broader" taxes, most of them are nothing more than fines and penalties for successfully engaging in legal economic activity. As such, they constitute a structure of perverse incentives. How can they be justified?

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