- The Economist examines the latest research showing the amount of money stashed in tax havens is even higher than previously estimated. And the Guardian calls for action on the IMF's conclusion that we'll all end up better off if the wealthy pay their fair share in taxes:
The IMF’s analysis does something to redress the balance, making two important points.- Bernie Sanders highlights the contrast between the greater equality Americans want, and the government by and for the few they're instead stuck with. And Rachel West and Harry Stein find that the Republicans are managing to overrun their own farcical talking points about the uses of government revenue - as they could in fact buy and maintain a pony for every small American child with the money they instead plan to funnel to the wealthy.
First, it says that tax systems should have become more progressive in recent years in order to help offset growing inequality but rather have been becoming less progressive. Second, it finds no evidence for the argument that attempts to make the rich pay more tax would lead to lower growth. There is nothing especially surprising about either of the conclusions: in fact, the real surprise is that it has taken so long for the penny to drop. Growth rates have not picked up as taxes have been cut for the top 1%. On the contrary, they are much weaker than they were in the immediate postwar decades when the rich could expect to pay at least half their incomes – and often substantially more than half – to the taxman. If trickle-down theory worked, there would be a strong correlation between countries with low marginal tax rates for the rich and growth. There is no such correlation and, as the IMF rightly concludes, “there would appear to be scope for increasing the progressivity of income taxation without significantly hurting growth for countries wishing to enhance income redistribution”.
With a nod to the work of the French economist Thomas Piketty, the fiscal monitor also says countries should consider wealth taxes for the rich, to be levied on land and property. The IMF’s findings on tax provide ample and welcome political cover for Mr Corbyn and John McDonnell, the shadow chancellor, as they seek to convince voters that Labour’s tax plans are not just equitable but also economically workable. By contrast, the study challenges Donald Trump to rethink tax plans that would give an average tax cut of more than $200,000 a year for someone earning more than $900,000. The response from the US administration was predictable: mind your own business. The IMF is not naive. It knows it is one thing to make the case for higher taxes on the rich but another thing altogether to get governments to implement them, because better-off individuals have more political clout. The IMF has demolished the argument that what is good for the super-rich is good for the rest of us, but don’t expect the top 1% to give up without a fight.
- Meanwhile, Tom Parkin writes that a distorted tax system is contributing to the erosion of Canada's middle class. Andrew Coyne discusses how the Libs' already-pathetic excuse for closing some loopholes has turned into another giveaway to corporations. And Chantal Hebert comments on the comedy of errors surrounding the Libs' tax policy.
- Kamal Ahmed points out that younger workers in the UK are increasingly having to borrow just to cover basic expenses. And Barbara Ellen writes about the patent unfairness resulting from people living in poverty having to pay more for the necessities of life.
- Finally, the Mound of Sound blasts the Libs for insisting on new pipelines rather than taking any meaningful steps toward a green transition (or even an honest accounting of the costs of fossil fuels). And Nike Block comments on Canada's longstanding and shameful history of prioritizing exploitative mining over people around the globe.
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