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Journalism of Courage
The era of banking secrecy is over. So said the leaders of the G-20 assembled in London,in the text of the communiqué that ended that meeting. Those words serve to illustrate
the moment in which we,as constituents of the world economy,find ourselves: a moment in which globalisation takes a natural step forward and tackles the dark,unswept corners of the international financial system that tax havens represent.
At a time in which the tax nets of the worlds larger economies are propping up the world economy,one could hardly expect an argument predicated on fraying those tax nets to have any power. While nobody can deny the right of any individual to choose his or her personal location,tax havens provide more than a destination for those who believe that income tax and slavery have similar features,morally. Offshore tax havens provide a particular combination of banking secrecy and no-tax status that is meant to entice those who would otherwise run afoul of domestic anti-avoidance laws. Thats the simple fact that theres no getting around. The OECD has sensibly worked in the past to minimise the effect of tax havens; the last effort was scuppered by the Bush administration otherwise no fan of permitting secrecy in financial transactions. The world has since changed. Its not just security,and the financial crisis: in the networked,information age,no transaction is trackless any more. Mutual assistance treaties,in which an offshore financial centre undertakes to help a home jurisdiction follow a trail tax-evading companies or individuals have left,have already been signed by several former and possible tax havens. The G-20 threatens sanctions on those jurisdictions that dont cooperate in future. That should surprise nobody.
