Treasure Islands is a book about tax havens by Nicholas Shaxson, who has written for the FT and The Economist. The book claims that tax havens and the whole offshore finance system is the reason behind all of the world’s delimma’s including rising inequalities (the rich don’t pay taxes), the financial crisis, and poverty in Africa (oil, mineral and foreign aid money is welcomed with open arms in Geneva and the City of London which can hide it using its web of offshore satellites (Jersey, Cayman Islands, Bahamas etc…)).
The book is full of interesting anecdotes, historical facts, and is a fresh reminder that something just ins’t right with the world economy. We no longer live in democracies but rather in a world where money determines policy. This explains why offshore finance is “legal” and rich people pay no taxes while governments are forced to target the average person.
Tackling tax havens needs to be a priority, and is a much better idea than cutting pensions to reduce the debt burden of Greece. According to the book, 99% of deposits from Greece in Switzerland are undeclared to tax authorities.
• 12 trillion (1/4 of world’s wealth) goes untaxed in the tax havens. If banks/companies were included the amount would be twice. Every FTSE 100 company has subsidiaries or partners in tax havens in order to avoid paying taxes.
• London is described as the center of a spider web that links to the Channel Islands, the Isle of Man and Caribbean, serving the needs of global capital.
• Shaxson believes the US and UK are they biggest tax havens in the world. For example, the US (DE, WY, FL and NV) is responsible for 21% of offshore business, while the UK is responsible for 20%. A further 10% derives from the trade carried out through Britain’s dependent territories. On the other hand, Switzerland is responsible for 6% of offshore trade.
• Tax havens cost the US 100 bn/yr in lost revenue