A better world is possible - Global Commons Institute

Copyright Bruce Nixon 2010. All rights reserved. This electronic copy is provided free for personal, non-commercial use only.
www.brucenixon.com
Taxing the value added by the majority of people’s positive contributions to society (VAT), and
failing to tax the value subtracted by the rich and powerful minority who profit most from the use of
common resources, systematically skews the overall burden of tax to the detriment of the majority.
Organic food is beneficial not only in the dietary sense but also because of all the ecological
advantages, thus saving of cost (perversely counted as GDP!) in cleaning pollution. In the recession,
we now see people spending less on organic food and supermarkets cutting out organic products
which are nature, health and people friendly. This causes producers even more difficulty surviving.
Existing taxes are also becoming less viable.
For example:
National economies in a competitive global economy have to reduce taxes on incomes, profits and
capital in order to attract and keep investment capital and highly qualified people - both being
increasingly mobile.
Ageing societies will be unable to support growing numbers of economically inactive people by
taxing the work and enterprise of fewer people of working age.
Internet trading makes it more difficult for governments to collect customs duties, value added tax
and other taxes and levies on sales, and easier for companies and rich individuals to shift earnings
and profits to low-tax regimes and tax havens.
Tax avoidance by big corporations and rich individuals is increasingly damaging. The Tax Justice
Movement estimates that tax havens now cost governments £255bn annually and hold assets of
$11.5 trillion, causing serious distortion of economic priorities and encouraging criminal money
laundering.
Tax Havens
In the case of tax avoidance, international action to close tax havens and insist on full disclosure in company
reporting is now a possibility following the G20 agreement in April 2009. It is worth noting that Britain is one
of the largest providers of tax havens in its Crown Dependencies or Colonies. Well-known large UK
businesses and business men are amongst the largest users of these facilities. Over a quarter of the world’s
tax havens are British property. More than half of Britain’s colonial territories and dependencies are tax
havens, including Jersey, Guernsey, Isle of Man, Bahamas, Bermuda and the Virgin and Cayman Islands. The
Cayman Islands are now the fifth largest financial centre in the world, after New York. Tax lawyers regard the
Caymans as a no-tax or zero tax haven.
From the perspective of ending poverty, tax havens are used by large companies to divert funds that would
otherwise be paid in taxes to poor countries - Christian Aid estimates $160 billion a year, 60% higher than all
the international aid the poor world receives. The US research group Global Financial Integrity estimates
$900bn. For a full account of the extent of tax havens and the cost to nations and tax payers throughout the
world, go to the Tax Justice Network’s website.
Would people be so happy holidaying in these places if they knew what underlies the prosperity of these
destinations?
Shifting a large part of the tax burden onto the value of land (which cannot move elsewhere) through Land
Value Tax, may be one of the most effective responses to these problems.
Taxing the Commons
Commons are resources whose value is due to nature and to the activities and demands of society as a
whole, not the efforts or skill of individual people or organisations. Land is the most obvious example. The
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