Why Taxation Must Go Global
Citizens and businesses expect their governments to provide many programs – highways and other infrastructure, public health, and defense – but most despise paying taxes. “As a result of the growing pace and intensity of globalization and digitization, more and more economic processes have an international dimension,” notes Wolfgang Schäuble, Germany’s federal minister of finance. “As a consequence, an increasing number of businesses are adapting their structures to domestic and foreign legal systems and taxation laws.” Tax legislation has not kept up with a digital economy where business transactions quickly cross boundaries and income is highly mobile. Revenue and the number of taxpayers are down even as the demand for public services remains high. The most powerful economies struggle to collect taxes across borders and pressing global problems are neglected. A few governments have signed and more are considering an agreement on the automatic exchange of information on financial accounts, requiring banks to supply select information to relevant tax authorities. Schäuble concludes that international standards that are uniform, transparent and fair would ensure appropriate government services and prosperity. - YaleGlobal
Why Taxation Must Go Global
Intense competition among nations to reduce taxes to attract corporations also reduces prosperity
Monday, November 3, 2014
Wolfgang Schäuble has been Germany’s Federal Minister of Finance since 2009, helping to engineer the country’s remarkable post-crisis growth. He previously served as Minister of the Interior during the governments of Angela Merkel (2005-09) and Helmut Kohl (1989-91), and has been Chairman of Germany’s ruling Christian Democratic Union.
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