Since one of my main priorities is to defend tax competition and tax havens, I’m always delighted to see others jump in the fight to defend fiscal sovereignty.
Especially when those people clearly understand that so-called tax havens are necessary to restrain the compulsive tendency of “onshore” politicians to over-tax and over-spend.
Tax havens are in fact essential, especially international financial centres. Tax rules are often unjust… nobody should be taxed twice on investment returns. …it would be to the detriment of us all if there were no tax havens. Most predatory activity is actually undertaken by governments and not by companies. Governments are trying to spend more and more with the UK government now spending 50 per cent of national income – in common with other European Union countries. This is deeply damaging to general welfare and business in particular and it is very difficult to hold the elites who conÂtinually expand the size of the state to account. Elections are very imperfect mechanisms. One effective method by which we can keep the size of government in check is if labour and capital can exercise its freedom to move to lower-tax jurisdictions. Capital is much more mobile than labour and so tax havens do us all a favour by ensuring that governments have to keep tax rates lower – thus creating a better environment for business.
This hits the nail on the head.
For all intents and purposes, the existence of tax havens makes tax competition more robust. And we need vigorous tax competition because politicians – with some sort of external constraint – will drive their nations into Greek-style fiscal chaos.
But there’s also a moral case for tax havens, as explained in this video.