Tax havens (Part 2)

Even the FT says that, despite some recent apparently spectacular successes, 'tax collectors have a nagging fear they may be fighting a losing battle against tax evasion" (Vanessa Houlder, 6 May). Powerful pressure groups like the Center for Freedom and Prosperity argue that 'tax havens play a crucial role in putting downward pressure on tax rates in industrial countries.' Other keywords are 'market discipline', 'tax competition', 'fiscal sovereignty' and 'financial privacy', while those on the other side are characterised as 'advocates of tax harmonisation' and 'opponents of economic liberalisation'.

The OECD's efforts to constrain [the havens] were watered down after 2001, when the Bush administration complained this would stifle tax competition.

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