Tax avoidance is hot news – and especially because American tech darling Apple was called before a Senate subcommittee to explain why they paid such very low taxes in this country despite earning billions in revenue.
Today we hear of world leaders calling for international tax laws to deal with the issues of tax avoidance, tax havens, offshore treasure islands and the like. And while this would seem like good news, it just shows the capacity of the multinational corporations to dominate the agenda and resource allocation of nation states. Corporations get out in front of the laws – creating products and situations for which we do not yet have regulation. What we then have is a wild-west situation with cowboy corporations pushing into to lawless areas until governments catch on.
We have been focusing on the lack of accountability to domestic government institutions but the situation is much more extreme when one turns international. No, this is not the beginning of international corporate law. When the dust clears, we may see weak agreement among the multinational drone corporations to voluntarily restrict their own activities – but we know how well that works. And, if they were truly going to act nice of their own accord why do they have entire legal and tax departments seeking out loopholes and havens in the first place? Maybe this is a first effort at wrangling these wayward corporations on the tax haven issue but the asymmetry of power between the corporation and the nation-state is stark.