The Adam Smith Institute in London has released my paper entitled “The Economics of Tax Competition.” If you want to understand why it is very important to prevent international bureaucracies from crippling national tax sovereignty in order to create an “OPEC for politicians,” you should spend 20 minutes reading this report. If you went to a government school and don’t like reading, this three-part video series covers the same material. Here’s an excerpt from the introductory section:
Tax competition exists when people can reduce tax burdens by shifting capital and/or labour from high-tax jurisdictions to low-tax jurisdictions. This migration disciplines profligate governments and rewards nations that lower tax rates and engage in pro-growth tax reform. …from an economic perspective, economic performance is enhanced because of lower tax rates on work, saving, and investment. …The thought of losing sources of tax revenue worries government officials from high tax nations, who vociferously condemn tax competition (particularly the role of so-called tax havens) and would like to see it reduced or eliminated. Working through international bureaucracies like the European Commission (EC), the United Nations (UN), and the Organisation for Economic Co-operation and Development (OECD), high-tax governments are promoting various tax harmonization schemes to inhibit the flow of jobs and capital from high-tax jurisdictions to low-tax jurisdictions. These proposals are fundamentally inconsistent with good tax policy. Tax harmonization means higher tax rates, but it also means discriminatory and destructive double taxation of income that is saved and invested. …Tax competition should be celebrated, not persecuted. It is a powerful force for economic liberalization that has helped promote good tax policy in countries around the world.
[…] if you want to really understand these issues, I humbly suggest you look at the paper I wrote for the UK-based Adam Smith Institute. Share and […]
[…] if you want to really understand these issues, I humbly suggest you look at the paper I wrote for the UK-based Adam Smith Institute. Rate this: Share […]
[…] they will behave in a predictable fashion by raising tax rates. In other words, the weakening of tax competition is a recipe for bigger, more expensive […]
[…] of sovereignty. For all intents and purposes, the Multilateral Convention outlaws certain pro-growth tax policies and discourages others. Equally worrisome, it creates a system allowing foreign tax collectors to cross borders. The Obama […]
[…] tax returns. 3. Loss of sovereignty. For all intents and purposes, the Multilateral Convention outlaws certain pro-growth tax policies and discourages others. Equally worrisome, it creates a system allowing foreign tax collectors to cross borders. The Obama […]
[…] Loss of sovereignty. For all intents and purposes, the Multilateral Convention outlaws certain pro-growth tax policies and discourages others. Equally worrisome, it creates a system allowing foreign tax collectors to cross borders. The Obama […]
[…] readers know that I’m a big fan of tax competition because politicians are less likely to misbehave if the potential victims of plunder have the […]
[…] readers know that I’m a big fan of tax competition because politicians are less likely to misbehave if the potential victims of plunder have the […]
[…] readers know that I’m a big fan of tax competition because politicians are less likely to misbehave if the potential victims of plunder have the […]
[…] perhaps, could it be the case that leftists on both sides of the Atlantic don’t like tax competition? But rather than openly argue for tax harmonization and other policies that would lead to higher […]
[…] the good news. The bad news is that greedy politicians don’t like being constrained by tax competition. Politicians didn’t lower tax rates because they wanted to. They only made their tax systems […]
[…] the good news. The bad news is that greedy politicians don’t like being constrained by tax competition. Politicians didn’t lower tax rates because they wanted to. They only made their tax systems […]
[…] since the OECD is the international bureaucracy pushing for global tax rules to undermine tax competition and reduce fiscal […]
[…] since the OECD is the international bureaucracy pushing for global tax rules to undermine tax competition and reduce fiscal […]
[…] since the OECD is the international bureaucracy pushing for global tax rules to undermine tax competition and reduce fiscal […]
[…] since the OECD is the international bureaucracy pushing for global tax rules to undermine tax competition and reduce fiscal […]