In his new book (only available in French at this stage) Belgian journalist Eric Walravens explores how tax wars within the European Union are destroying attempts to create fair markets. The subtitle says it all: Enquête Sur Un Chantage Qui Ruine Nos États translates as Investigation into a threat that is ruining our States.
The threat in question is the constant demand by big businesses for lower taxes, subsidies, tax breaks, exemptions, special treatments and so on. Little by little, over the course of the past 30 years, Capital has gained the upper hand in most democratic countries, and now uses its political power to require extraordinary concessions.
TJN has a great interest in this subject. We think of tax “competition” between states as another form of economic warfare, every bit as destructive as exchange rate wars. Hence we prefer the term Tax Wars, which far more accurately describes the reality of one country (Ireland, say) using its sovereignty in tax matters to undermine the tax regimes of other countries in a blatant form of beggar-thy-neighbour politics.