Reforming a country’s tax code can often be an agonizing process. Often, it starts with the formation of a panel of experts or parliamentarians, charged with studying various options for reform. Then, the panel will publish a report detailing where the tax system is failing, and proposing ways in which it can be fixed. The report will then be submitted to parliament or the government, upon which the finance minister will laud the great work and dedication of the panel and its chairman. Within a week of this, it’ll probably be forgotten about. Or, if a tax reform bill is eventually drawn up, it will be so divisive as to be virtually impossible to approve, with the result that it gets batted back and forth between lower and upper chambers, finance committees, and constitutional courts. Some members of the legislature … Read More »
So what was the point of all that then? I refer of course to the humiliating conclusion for Greece in its attempt to renegotiate its bailout terms. Almost unbelievably, after six months of deadlock and brinksmanship, Athens has seemingly managed to secure itself worse terms than those it originally protested against, and significantly worse ones than were on the table just a short while ago.
I keep reading and hearing in the media that Greeks will be subjected to harsh new tax rules as part of the agreement. It’s certainly true that the screw will be turned ever tighter on tax evaders. However, the statement summarizing Greece’s obligations, which was released after the Euro Summit on July 12, barely mentions the word “tax.” In fact, taxation is referred to twice, and both references are vague in the extreme: streamlining the VAT … Read More »
Many politicians try to be all things to all people, but few manage to achieve it. George Osborne, the Chancellor of the United Kingdom Exchequer (aka, the Minister of Finance), is making a very good claim to be inducted into the “few that manage to achieve it” hall of fame in later life after announcing a quite remarkable “emergency” Budget last week. Indeed, it was a budget statement that could justifiably earn Osborne a new nickname – The Borrower – for he seems to have borrowed key policies from political opponents vanquished recently at the general election, particularly from the Labour Party, including a big increase in the minimum wage and the virtual extinction of non-dom tax status (although, now he’s taken them, he can’t really give them back, can he!) I can recall that when the UK first got … Read More »
I never thought I’d see the day, at least in the remainder of President Barack Obama’s second term, when Democrats and Republicans would agree on a piece of legislation vital to the United States’ economic interests. But there was an uncharacteristic bout of bipartisanship in Washington last week as Congress passed the long-awaited renewal of trade promotion authority (TPA) legislation. Without TPA, also known as fast-track, contentious free trade agreements could be filibustered in Congress, so there would probably be no Trans-Pacific Partnership. Actually, it is stretching the truth somewhat to suggest that TPA was approved in a spirit of total political harmony. For many months, senior Democrats in the Senate put up a good fight against a bill they argued would allow unbalanced free trade deals to be rammed through Congress without adequate scrutiny. Indeed, the real acrimony here … Read More »