A gentle riposte to those promoting tax havens – or the answer's in the ballot box

October 14th, 2011

There have been more responses to Action Aid’s report on the use of tax havens by FTSE 100 companies. One on a site called Shelter Offshore is interesting. Take the conclusion first:

“Finally, a suggestion to all those people out there who expend excessive energy attempting to force a moral conscience on big name businesses with subsidiaries in low tax havens – you will never win.

Your voices and actions have absolutely no effect at all. Companies like these have shareholders to whom they are accountable. They will do the least they possibly can to show a seeming willingness for transparency, and they will do the most they possibly can to avoid as much tax as they can get away with.

Instead of fighting an unwinnable war why don’t you put your brand of persistent pressure on your governments to spend all tax revenue responsibly instead, and then and only then will you ever have any leverage to bring big corporates back in from the cold.”

Muse on that for a moment and what you’ll see this person (unnamed, of course) is saying is that capital can and will do what it likes and nothing civil society or the polotical process can seek to do about it will stop it doing so. It’s an interesting idea, but what is readily apparent is that first of all he’s saying wealth matters and democracy does not. The only accountability he (I’m sure it’s a he, these things usually are) is concerned about is that to wealth.

And what else is this person saying:

“In spite of the fact that the report is well written, interesting, fairly well balanced and very informative, I have been left with a very clear sense of why all those battling to clamp down on offshore centres should actually continue to fail. What’s more, I believe that everyone who can utilise legitimate tax breaks to help them reduce their tax burden should exploit every last one of them. You see, until there’s accountability there should always be tax havens…

I believe that tax is a necessary evil – in theory the tax revenue raised by a nation’s government keeps people out of poverty, it keeps them safe and healthy, it educates them and ensures that those who can contribute to the greater good of society do so for the enhancement of the lives of those who can’t.

However, in the real world tax doesn’t work like that…at least not in all the so-called ‘developed’ nations around the world.

In the UK for example, tax is used to bail out banks, to bail out other nations’ banks, to warmonger, and it is squandered and wasted time and again. In other words, there is absolutely no accountability whatsoever in terms of how the tax revenue raised is spent.”

And that he says is because:

“The Treasury isn’t run transparently, it isn’t run like a big business with shareholders, it isn’t accountable to anyone.”

But hasn’t he noticed something called democracy? Oh, it’s imperfect all right. I accept that. And I also agree government could and should be more accountable. But, democracy is undoubtedly the best form of government yet developed. And perpetually undermining the will of parliament is anti-democratic – as is the whole tone of this piece. That’s because it’s not saying I’ll pay tax because the due process of law says I should. And I’ll pay tax because it’s what’s needed to uphold democracy, capitalism and the whole system of private proieprty. No, it’s saying tax if I want to on my terms for what I want and if I don’t get what I want I’ll try to undermine the system.

This is the 1% – the world’s wealthy – speaking. This is the language of those who call democracy a tyranny because it demands the rich share. It’s the language that threatens us all. It’s the language that says the world’s wealthy demand the overthrow of democracy. It’s the language that leads to the corporate state.

And we will win against it. Because we believe that the answer is in the ballot box. And we’re right to say that. And right is on our side. But it’s not on the side of the 1%. And it’s not on the side of the tax haven abusers. And ultimately I have a very strong belief that right wins. But not, I admit, easily.

Written by Richard Murphy

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