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The Hidden Wealth of Nations

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The Hidden Wealth of Nations

The Scourge of Tax Havens

University of Chicago Press,

15 min read
10 take-aways
Text available

What's inside?

The amount of wealth stashed in shadowy tax havens will astound you.

Editorial Rating

8

Qualities

  • Analytical
  • Eye Opening
  • Engaging

Recommendation

The Panama Papers scandal of 2016 has refocused attention on tax havens, those shadowy destinations where billionaires, oligarchs and despots hide their cash. In this fascinating investigation, economist Gabriel Zucman estimates that some $7.6 trillion is squirreled away in secret accounts in Switzerland and other locations. Right-wing commentators have bashed his findings. But to his credit, Zucman acknowledges that the clandestine nature of tax havens makes it nearly impossible to pinpoint a figure. His crisp, lively prose makes this slim tome a worthwhile read, no matter your ideological bent. While always politically neutral, getAbstract recommends this book to taxpayers and tax collectors seeking a fresh analysis of an old issue.

Summary

Offshore Tax Evasion Is Alive and Well

Tax evasion amounts to little more than stealing from national coffers. Yet, offshore tax havens such as the British Virgin Islands, Switzerland and Luxembourg provide a conduit for wealthy elites to deprive their less affluent fellow citizens of public dollars. Since 2010, banking crises in Ireland and Cyprus, both offshore banking hubs, have impoverished thousands of people. Apple’s offshore profit-stashing has deprived the US Treasury of tens of billions of dollars in tax revenue.

The rich and powerful would have you believe that you can do nothing to stop offshore tax havens. Some argue that capital always will seek the lowest tax rate and that nations inevitably will compete for assets by creating favorable tax structures. But this behavior can lead to protectionist policies. Others claim that tax evasion has mostly ended. In fact, tax evasion remains alive and well. “Tax avoidance” by US corporations totals $130 billion a year. Tax evasion disproportionally benefits the rich because they hold the greatest volume of equities.

Tax havens are cloaked in secrecy, confounding attempts to measure their financial heft...

About the Author

Gabriel Zucman is an assistant professor of economics at the University of California at Berkeley. He also taught at the London School of Economics and is co-director of the World Wealth and Income Database.

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