Tax Evasion and Tax Havens since the Nineteenth Century

Description

This collective book offers a panorama of the history of tax evasion, tax avoidance and tax havens from the nineteenth century to the present day, based on the latest research in contemporary history. It aims to show that this phenomenon is at the heart of global capitalism, partly as a response of the ruling classes to the rise of progressive taxation, but for other reasons too: notably the development of a powerful tax evasion and avoidance industry in different countries. The book argues that tax competition between states has stimulated the development of tax havens. It discusses the notion of the ‘tax haven’ and proposes a more rigorous concept - that of the ‘tax predator’. Finally, the book sheds light on the socio-political conflicts that have developed around tax evasion and the way in which states have fought against or tolerated the phenomenon. Preface Contents Editors and Contributors About the Editors Contributors List of Figures List of Tables 1 Introduction. “Low-Tax Predators” Rather Than “Tax Havens”: New Perspectives on the History of the International Tax Evasion and Avoidance Market A History Still in Its Infancy A New Periodization and Its Consequences Factors Behind the Formation and Development of Tax Havens The Predatory Role of Tax Havens The Need for a Rigorous Definition and a Sound Concept of Tax Havens References Part I Emergence and Expansion of Tax Havens 2 The Emergence and Expansion of Tax Havens, 1850–2000: Insights from a New Dataset The Construction of a Dataset on Tax Havens’ History The Role of Legal Reforms Data The Development of Tax Havens Determinants The Role of Demand Other Determinants Conclusion Bibliography 3 Emergence and Expansion of the Swiss Tax Haven: The Tax Privileges for Rich Foreigners in the Canton of Vaud, 1840–1959 Some Figures Why Attract Wealthy Foreigners? The Tax Exemption of Wealthy Foreigners at the Heart of the Emergence and Development of Wealth and Income Taxation (1840–1916) The Lump-Sum Taxation: A Product of the First World War (1918–1946) The Effects of the Second World War: A Minimal Revision of Lump-Sum Taxation (1947–1959) Conclusion Bibliography 4 Emergence of, and Threats to, the Belgian Tax Haven During La Belle Epoque, 1890–1914 ‘A Convenient and Safe Haven’ New Military Expenses and the French Initiative Levie’s Taxes The Excellence of Levie’s Speech The Four Tax Rules of Charles Woeste Conclusion Bibliography 5 The Oil Multinational Shell’s History of Using Tax Evasion Methods, Including Tax Havens and Political Pressure, 1914–1974 Introduction Avoiding Dutch Taxes Via a ‘Trick’ Amendment of Statutes Failed Attempt to Deceive the Tax Authorities Political Influence Tax Gifts on Curaçao Complicated Construction Position of Power Higher Taxes for the Oil Concern Tax Evasion of 100 Million Using the Tax Haven of Curaçao A ‘Sweetener’ of 35–100 Million Conclusion Bibliography 6 Swedish Emigration to Switzerland in the 1960s–1980s Period: Tax Exile and Settlement Choices Settlement Choices of the Wealthy—to Minimise Taxes or to Live with Other Wealthy People? Sources and Data Taxation in Sweden and Switzerland—An Overview Swedish Immigration in Switzerland Tax Rates in the Swiss Cantons Settlement of Swedes in Swiss Cantons Swedes as Important Lump-Sum Taxpayers The Clustering of Swedes in Switzerland and Their Socio-Economic Background Conclusion Bibliography 7 The Rise of Tax Havens and Conduit Countries from the Early 2000s Characteristics of Corporate Tax Havens and Conduit Countries Recent Developments The Proof of the Pudding Is in the Eating Conclusions Bibliography 8 Luxury Free Ports as Purpose-Built Conduits for Tax Evasion, 1990–2020 The History of Free Ports Geneva Free Port UK Free Ports Conclusion Bibliography Part II Tax Evasion: Extent, Causes, and Conflicts 9 Income Tax Evasion and Avoidance in Germany, 1850–1920 Tax Collection and Evasion of UK Income Tax Progressive and Comprehensive Income Tax in German States Criminal Tax Law and Tax Evasion in Prussia Bremen The German Pioneer of Progressive Income Tax: Saxony 1874–1914 Tax Avoidance and Evasion in Saxonia in WWI Outlook Bibliography 10 Volume, Social Distribution, and the Instrumentalisation of Tax Evasion in Switzerland: The Case of Zurich, 1860–1945 The Extent of Tax Evasion and Its Social Distribution (1860–1919) The Political Mobilisation of Tax Evasion Before World War I Tax Evasion in Zurich During the Interwar Period and the Second World War Conclusion Bibliography 11 War Profits and Tax Evasion: Italian Fiscal Policies in the First World War and After the War, 1915–1924 The Tax on War Profits The Main Tax Evasion Practices The Assessment of Income and the Collection of the Tax The Payment of the Tax and Its Vision Conclusions Bibliography 12 Tax Compliance in a Crisis: Evidence from the Great Depression, 1929–1936 Introduction Background Data Factors Associated with Tax Non-compliance Persistent Effects of Tax Non-compliance Discussion Limitations Implications Concluding Comments Appendix Bibliography Part III Fighting Tax Evasion and Tax Havens? 13 Criminalising Tax Evasion in France, Early Nineteenth Century–2008 Criminal Sanctions Limited to Indirect Taxes During the Long Nineteenth Century The Difficult Extension of the Repressive Regime to Direct Taxes (1900–1936) Punishments and Convictions in the Second Half of the Twentieth Century Conclusion: A Purely Symbolic Penalisation Bibliography 14 “These Patriots Who Misuse the Law”: The Background to the United Kingdom’s Anti-Tax Haven Legislation of 1936 Offshore Tax Avoidance in the Pre-1914 Era Taxpayers Shift from Offshore Investment Accounts to Offshore Holding Companies and Trusts The Revenue’s Search for a Legislative Solution to Offshore Tax Planning Problems Regarding Information and Enforcement, and the Subsequent Fate of the Legislation References 15 Tax Evasion as Seen by French Tax Administrations from the 1920s to the 1970s: Pragmatism in Action Propaedeutic Between Two World Wars The Ideas Are in Place: The National Bloc An Uncompromising Assessment in 1929 1.3 Late but Promising Reforms Between Resistance and Accommodation The Tax Problem Time for Reforms and Compliance Teams Tax Intolerance Conclusion—Fighting Tax Evasion: Is It an Impossibility? Bibliography 16 Detecting Ordinary Tax Evaders: The Example of the 1945 National Solidarity Tax in France A Reparation Tax Threatened by Evasion Fighting Tax Evasion: A Political, Financial and Moral Imperative A Campaign Plan to Fight Tax Evasion Upstream Massive Evasion and Avoidance? The Statistics in Relation to the Files A Systematic and Methodical Control of the Files From Arbitration to Arbitrariness? The Controller’s Personal Interpretation Conclusion Bibliography 17 Tax Education After WWII: How Spain, the USA, and West Germany Tried to Make Their Citizens Pay Honestly Introduction: Tax Education as One Field of Tax Compliance Improvement Tax Education as “Training in Citizenship”: A Transnational Comparison USA: The International Forerunner in Tax Education Tax Education as War Propaganda The 1950s/1960s The 1970s/1980s Spain: Tax Education Under Dictatorship, Transition and Democracy Tax Education in an Authoritarian Regime From Subjects to Citizens Tax Education in Developed Democracy Western Germany: Largely an Abstinence of Tax Education Widespread Tax Evasion After WWII No More Tax Education: When the Economic Miracle Starts Conclusion and Open Questions Bibliography Index