If near half of the world GDP is hidden in tax havens, what are we arguing about

[CountDeMoney]

Are you saying that capitalism is theft?

No, I'm saying capitalism is the successful accumulation of wealth without consequence or accountability.

Whether or not it's theft is incidental.

[Neil]

Still, it's a pretty idiotic argument, even for a beet-eating goat-herder.

It's funny watching you act like you're better than he is.

[Neil]

Avoiding taxes isn't really theft though.  Hell, even evading taxes isn't really theft.

[Razgovory]

Plus, that 32 trillion is SOMEWHERE. It is not under pillows. It is in the banks of less fortunate states, which should be a socialist's wet dream I guess.

Less fortunate states?
....
err....
Tax havens tend to be rather wealthy places to put it mildly...

for the bankers, not so much the citiazens. Not all shelters are make coocoo clocks and cheese.

But most are fairly wealthy or at least average.

[dps]

Plus, that 32 trillion is SOMEWHERE. It is not under pillows. It is in the banks of less fortunate states, which should be a socialist's wet dream I guess.

Less fortunate states?
....
err....
Tax havens tend to be rather wealthy places to put it mildly...

They do tend to be places lacking in the natural resources needed for tradtional heavy industry, though.

But why that would be a socialist's wet dream, I don't know.  True, those banks aren't just sitting on the money, they're using it for loans and such, generating a lot economic activity, but why a socialist would like that when it's the opposite of socialism I have no idea.  Perhaps Tamas is still somewhat influenced by the notion that socialists actually care about poor people, rather than caring about ideology.

[grumbler]

The idea that half of the world's GDP gets "hidden in tax havens" is absurd on the face of it.

Money in banks is part of the world's total wealth, not its total GDP.  If you are going to argue about something, why don't you argue about something that is true and meaningful?  Debating a bogus Marti "fact" isn't going to get you anywhere.

[DGuller]

The idea that half of the world's GDP gets "hidden in tax havens" is absurd on the face of it.

Money in banks is part of the world's total wealth, not its total GDP.  If you are going to argue about something, why don't you argue about something that is true and meaningful?  Debating a bogus Marti "fact" isn't going to get you anywhere.

Not sure what your beef is.  Total wealth and total GDP are both expressed in dollar amounts, so things like offshore wealth, or the price of a ballpoint pen, can be expressed in terms of either.  Besides, GDP is a common units by which to measure large amounts of money, even if the money involved are assets rather than income.

[Tamas]

Perhaps Tamas is still somewhat influenced by the notion that socialists actually care about poor people, rather than caring about ideology.

I hinted at that of course. I am actually aware, needless to say, that socialism is a highly selfish ideology.

[grumbler]

Not sure what your beef is.  Total wealth and total GDP are both expressed in dollar amounts, so things like offshore wealth, or the price of a ballpoint pen, can be expressed in terms of either.  Besides, GDP is a common units by which to measure large amounts of money, even if the money involved are assets rather than income.

Not all things that can be measured in dollars are the same, just as not all things that can be measured in degrees are the same.  Wealth and income are both measured in currency terms, but any economist could tell you that they are not the same thing.  If the amount of wealth represented by the money "hidden in tax havens" is only 1% of the wealth of the wealthiest 10% of the world's population, then "what are we arguing about?"  If the "hidden" wealth is 50% of the wealth of the wealthiest 10% of the world's population, then we know exacly what we are talking about.  Absent any relationship between "hidden" wealth and any meaningful wealth, we can draw no conclusions.

If nearly half the annual rainfall in Brazil is locked up in polar ice caps, what are we talking about?

[Martinus]

My point was that it is a huge amount, not that half of the world's wealth is hidden away in tax havens.

[The Minsky Moment]

I don't know what this means?.  What is being defined as a "tax haven"?  How is the number calculated and what is included?  Note that the fact money is kept in a low tax jurisdiction doesn't mean it isn't subject to tax, especially if the money belongs to a national of a country that taxes citizens on worldwide income (like the US), it doesn't mean it wasn't subject to tax before arriving there, and it doesn't mean it won't be subject to tax if it is used in some transaction outside the "haven" location.

[crazy canuck]

So, this thread was inspired by an article I read recently (unfortunately, only in print). According to estimates, up to $32 trillion of assets is stacked away in tax havens. This is nearly half of the global GDP (which is around $75 trillion).

We spend hours discussing the failures of the welfare state, whether to raise or decrease taxes etc. but at the end of the day, does it even matter if the uber-class simply does not play by the same rules as everyone else?

Your second proposition doesnt necessarily flow from your first proposition.  A "tax haven" doesnt mean that tax is not being paid.  Under Canadian law (and I believe US Law) and probably other jurisdictions, moving money offshore does not make it tax exempt in the domestic jurisdiction.

The step you are missing is the claim implied in your assertion that everyone who has money in a "tax haven" is not filing their taxes appropriately.  That is another issue entirely.

[Warspite]

Noise! Noise! Outrage!

[viper37]

So, this thread was inspired by an article I read recently (unfortunately, only in print). According to estimates, up to $32 trillion of assets is stacked away in tax havens. This is nearly half of the global GDP (which is around $75 trillion).

We spend hours discussing the failures of the welfare state, whether to raise or decrease taxes etc. but at the end of the day, does it even matter if the uber-class simply does not play by the same rules as everyone else?

it's nowhere near as bad as that, these numbers comes from hippie "think" tanks, where think is optional.  The only credible story I've read on this, based on credible numbers, put the amount at 4,6 trillion $ in 2007.  You can't really have more money invested in fiscal paradise than there are money in banks all accross the world, that just makes no sense.

Than you factor in a marginal tax rate of 35% accross OCDE countries, wich nets you 1,6 trillion $, assuming 100% of this money has never been declared.  Still a huge sum of money.  But then, you go with the money each country would get, assuming equal proportion as their share of the world's GDP (it's a stretch, but let's use it).  You get some really low numbers.  Something that covers the deficit for one year in a country like Canada.

And then you submit a sample of real data to people who study these sort of things, and you get even lower numbers.  We're talking 7 billion$ for Canada and all its provinces.  Still a lot of money?  Well, Quebec's current (real) deficit will be 8 billion$ this year.  That's a yearly deficit, not a debt. 

So even if we were able to tax all that money this year, we wouldn't cover our yearly deficit.  And people still use that excuse to avoid any kind of wellfare state reform.

If we were to do that maths, seriously, for any OCDE countries, I think we'd reach similar conclusions.

And of course, there is the matter of the legality of these sums of money.  It's easy to imagine filthy rich US billionaires evading their tax, but the reality is that a lot of this money would belong to criminal organization and their people.  Even if you eliminate all tax loopholes, "Al Queida of America Inc." is not going to file tax reports every year on its international operation.

And if we eliminate those fiscal paradise with 0% corportate taxes, will the business declare their tax were they pay 35% income tax or were they pay 12%?  In the end, some countries will get more tax revenues, but probably not the one the left assume.

[Admiral Yi]

I don't know what this means?.  What is being defined as a "tax haven"?  How is the number calculated and what is included?  Note that the fact money is kept in a low tax jurisdiction doesn't mean it isn't subject to tax, especially if the money belongs to a national of a country that taxes citizens on worldwide income (like the US), it doesn't mean it wasn't subject to tax before arriving there, and it doesn't mean it won't be subject to tax if it is used in some transaction outside the "haven" location.

This is the post I wanted to make earlier.

In a Michael Moore documentary we could just use Marty's number as a stand-in for tax cheating.