So here’s the question. Have you ever used a taxavoidance strategy like the double Irish, the Dutch sandwich, or the Swiss cheese? Almost certainly not. Known some slender, rich proportion of American individuals and companies has, and a new book by a University of California, Berkeley professor is casting the curtain on those fat cats wide The book is The Hidden Wealth of Nations by Gabriel Zucman, and it’s a slender, infuriating, and surprisingly readable text about the gnarly topic of tax evasion.
It all starts with a mystery. As if the Earth as a whole were trillions of dollars in debt to Mars, the liabilities side of the ledger has come in higher than the assets side of the ledger in Zucman’s memorable turn of The reason, he shows, is that the wealthy people and corporations holding those earthly assets are tremendously good at hiding them at least billion in taxes.
The problem is yet worse abroad.
The impact on inequality is very big and may be even bigger down the road. You see, the effective tax rate on wealth and capital is a key determinant of wealth inequality in the perspective, he said. The reason is again the shifting of the tax burden. That amounts to billions lost from government coffers every Ultimately, such evasion might exacerbate the inequality plaguing the highincome world, Zucman said. Besides, the after tax rate of return to wealth gets higher than the aftertax rate of return to work. Let me tell you something. It’s not intuitive, he told me.
Those figures rise to 10 percent for Europe, 22 percent for Latin America, 30 percent for Africa, 52 percent for Russia, and a whopping 57 percent for the Gulf countries. That’s interesting right, right? Only about 4 the United percent States’ wealth is held offshore, Zucman shows.
What is worse is that the world’s bureaucrats have attempted to tackle tax evasion, and their efforts have largely proven ineffectual.
Whistleblowers remain a crucial way to identify tax evaders first and foremost. So total proportion of foreign wealth managed in Switzerland has increased 18 percent, since so. Nonetheless, in 2009, in the midst of the global financial cr, the Group of 20 countries promised a crackdown. Nicolas Sarkozy, therefore the president of France, declared the end of tax havens. Across all tax havens, I know it’s 25 percent. Yes, that’s right! The OECD
created new rules.
that does not have to be the case, Zucman argues. People don’t realize the extent, Zucman told me. They don’t That the significant problem of tax evasion, and why a lot more That’s a fact, it’s the eventual. Political pressure around the salience of tax havens to the big debate on inequality could also may seem like a benign, gray area sort of elite wrongdoing. That’s good for American businesses, they think, ‘We know companies avoid taxes. Bag.