The document discusses actions the UN Secretary General could take regarding tax havens. It notes that while European countries are implementing spending cuts, wealthy individuals are sheltering capital in tax havens. It argues the Secretary General should encourage new rules on tax haven assignment and crack down on legal tax avoidance, which costs European countries billions annually. Currently, states provide amnesties rather than aggressively inspecting avoidance, incentivizing more aggressive schemes. A real agreement among major OECD countries is needed to change the system and allow states to regain control over multinational taxation to preserve social democratic systems.

1. If you had the opportunity, what actions would you demand of the United Nations Secretary
General? Why?
After the recent controversial amnesty, which was approved on the thirtieth of March 2012,
with the main purpose of fostering up to 2.500 millions euros, and having, notwithstanding,
according to the figures released by the Spanish IRS, collectedup to only 50.4 million euros
instead, I would request Ban Ki Moon to encourage the creation of a totally new set of rules
regarding assignment on tax havens. Indeed, we are experiencing the biggest cuts in
government spending ever seen in history and all European nations are trying to convince their
citizens that everyone will share the pain while many wealthy people are sheltering their
capital in mostly British and US tax havens, which are now at the heart of our global financial
system. In this sense, Nicholas Shaxson hit the nail on the head when he stated: “Policymakers,
journalists and many others must start to understand and accept how tax havens have become
the fortified refuges of financial capital, protecting it from tax and regulation and in the
process contributing to bringing the world to the brink of economic collapse in 2007”.
Through out the last three decades, the governments of the most important countries
belonging to the Organisation for Economic Co-operation and Development have always
claimed they wanted to crack down on those who use tax havens, and that includes not only
those who illegally evade tax but also those who use legal means to avoid paying it, as tax
avoidance nowadays must nowadays be considered an entirely legal activity. Furthermore, in
2006, the United Nations Tax Committee voted to approve a code conduct for international
co-operation on taxation. However, this was proven to be not enough since it can be denied
that codes of conducts are mere “soft-law” which do not rely in any legal force. Indeed,
despite a lot of hot air on the general subject, nobody has even tried to bring into disrepute
this particular argument about how tax havens were a central ingredient in the global financial
crisis.
Per contra, some people may assert tax havens help smooth investment flows around the
world, force taxes lower, or help people and companies avoid being taxed twice on the same
income. On the other hand, the whole purpose of tax avoidance is to get around the law,
which means to try to avoid the tax law and on the way, avoid paying the tax. It’s currently
costing the citizen of any of European country more than eight billion euros, even possibly
hundreds of billions every year. It goes without saying that it involves a very perverse logical
mechanism, since the states, instead of aggressively inspecting the avoidance strategies,
provides amnesties. Therefore, as a result, companies using such avoidance schemes become
every time even more aggressive, and those which haven’t yet start using will eventually be
compelled to do so in order to avoid being at a competitive disadvantage compared to the
first.
As a result, it is absolutely necessary to change the current system, and this requires a real
agreement at least among the major OECD countries. Our states must regain the control of
multinationals’ taxations, as it’s the only way in which we will be able to maintain the tax
systems as we have known them, and thereupon preserving the social and democratic state of
law in which the majority f us still believe in.