- Date published:
8:23 am, May 9th, 2016 - 15 comments
Categories: accountability, capitalism, class war, Ethics, International, overseas investment, poverty, scoundrels, tax - Tags: Mossack Fonseca, panama papers, poverty, tax, tax evasion
Not content with a fine crop of domestic poverty, it seems that NZ is in the poverty export business.
To quote an earlier post: Tax evasion is illegal. Tax avoidance is a moral grey-zone. They both cost governments income that could be used to further the public good. This interesting piece by Colin Holtz in The Guardian looks at the costs of tax evasion, and how (in America) the missing funds could be used to fund a UBI:
The Panama Papers prove it: America can afford a universal basic income
If the super-rich actually paid what they owe in taxes, the US would have loads more money available for public services
Called a universal basic income by supporters, the idea has has attracted support throughout American history, from Thomas Paine to Martin Luther King Jr. But it has also faced unending criticism for one particular reason: the advocates of “austerity” say we simply can’t afford it – or any other dramatic spending on social security.
That argument dissolved this week with the release of the Panama Papers, which reveal the elaborate methods used by the wealthy to avoid paying back the societies that helped them to gain their wealth in the first place.
But while working and middle-class families pay their taxes or face consequences, the Panama Papers remind us that the worst of the 1% have, for years, essentially been stealing access to Americans’ common birthright, and to the benefits of our shared endeavors.
The Tax Justice Network estimates the global elite are sitting on $21–32tn of untaxed assets. Clearly, only a portion of that is owed to the US or any other nation in taxes – the highest tax bracket in the US is 39.6% of income. But consider that a small universal income of $2,000 a year to every adult in the US – enough to keep some people from missing a mortgage payment or skimping on food or medicine – would cost only around $563bn each year.
A larger income, to ensure that no American fell into absolute abject poverty – say, $12,000 a year – would cost around $3.6tn. That is a big number, but one that once again seems far more reasonable when considered through the lens of the Panama Papers and the scandal of global tax evasion. Because the truth is that we have all been robbed, systematically, by the world’s wealthiest people, for decades. They have used those stolen dollars to build yet more wealth for themselves, and all the while we have been arguing with ourselves over what to do with the leftover pennies.
Enough. We have the money to solve our problems. The first step is to stop the global elite from hoarding and hiding it. …
It’s not just America:
Offshore finance: more than $12tn siphoned out of emerging countries
More than $12tn (£8tn) has been siphoned out of Russia, China and other emerging economies into the secretive world of offshore finance, new research has revealed, as David Cameron prepares to host world leaders for an anti-corruption summit.
Oil-rich countries including Nigeria and Angola feature as key sources of offshore funds, the research finds, as do Brazil and Argentina. Henry said the owners of this hidden capital were often so keen to secure secrecy and avoid their wealth being appropriated back home, that they were willing to accept paltry financial returns rather than investing it in ways that might promote economic development. Charging just 1% tax on this mountain of offshore wealth would yield more than $120bn a year, almost equivalent to the entire $131bn global aid budget. …
By enabling tax avoidance/evasion for the rich in other countries we are depriving those governments of income. It seems on the basis of the Mossack Fonseca leaks that NZ is particularly popular with the South American rich. In short, for the sake of some lawyer’s fees here, New Zealand is exporting poverty to those countries.
Key says we have no obligation to other countries. That it’s all perfectly legal. Yes, that’s exactly the problem.