Heretofore heroic Liechtenstein — one of the world’s great tax havens — has come under fire recently, as Germany has used spies in the tiny principality’s banks to find tax evaders.
The Financial Times predictably takes Germany’s side (“governments are right to insist that those who live in a country, and benefit from public services, pay tax”), but notes that Germans’ desire to flee a 50% tax rate is understandable.
Let’s hope Liechtenstein stands its ground, unlike other former tax havens that have caved under international (i.e., U.S.) pressure and compromised their banking-secrecy laws.
Germany, of course, violated Liechtenstein’s laws by paying bank insiders to share individuals’ private financial information.
One German politician is unapologetic, and deserves credit for at least stating the matter bluntly: “[That this was illegal] is irrelevant. What Germany will do is confront every tax suspect with the option of whether they want to drop their trousers and cooperate or possibly go to jail.”
11:15 pm on February 20, 2008
