Transcript
A (0:01)
Well, let's move away now to France, because the government of the French President Francois Hollande has been rocked by a tax scandal recently. His former budget minister is now charged with fraud over a secret Swiss bank account. And this is all the more embarrassing because Mr. Hollande came to power promising to deal with the excesses of the super rich. And now the President's fighting back. Yesterday he called for the eradication of all the world's tax havens. A great idea, maybe, but would it even be possible? Alex Cobham is senior fellow at the center for Global Development in Washington, which says it works to reduce global poverty and inequality. So should be right up Alex's street. Hello, Alex.
B (0:43)
Hi, Ron.
A (0:44)
Hi. Well, is there any merit in this idea, and has anybody before proposed outlawing tax havens?
B (0:55)
Well, on the one hand, I think you're quite right to be slightly cynical about this. You know, we have heard this kind of rhetoric before. Recently at the London G20 meeting in 2009, we heard the French, British and American heads of state effectively say that this was the beginning of the end for tax havens. And we've seen little progress since. But there is a sense that this time it may be different, not only in France, but actually across most of the rich countries in the world. There's so much pressure on tax revenues and such public anger about the ways in which, whether it's members of the elite, as in this case in France and similarly in Spain and Greece, or its large companies like Starbucks and Google have been high profile cases in the UK that really, it feels like politicians are on the verge of taking some really serious steps. And that would be good for developing countries to.
A (1:53)
And of course, over the years, I mean, we've seen tremendous movements in Switzerland, for example, to tie down this idea of anonymous accounts.
B (2:03)
Well, that's right. And it's the kind of thing that's been embedded for so many years and has so many people in fact, committed to it, both personally, politically and indeed financially, that it's very difficult to start to unwind that kind of secrecy. But one thing that was also significant today was we saw the British, French, German, Italian and Spanish governments agree for the first time to exchange tax information automatically among themselves. And that's the basis of a model which, if extended to a great many more jurisdictions, really would be the end of tax havens. You take away that secrecy and there's no point putting your money in Switzerland anymore, or indeed in Jersey, so on.