India Uncut

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Tuesday, February 13, 2007

Low taxes and free trade

Immense amusement -- and some consternation -- arises when I read this on Cato @ Liberty:
In a move that is both remarkable and disturbing, the European Commission plans to file a complaint - and threaten protectionist trade barriers - because attractive Swiss tax policies are supposedly a violation of a free-trade accord. The bureaucrats in Brussels are not arguing that Switzerland is imposing barriers against EU products. Instead, the Commission actually is taking the position that low taxes are attracting businesses that might otherwise operate in high-tax nations.
And this is wrong? You'd imagine people would learn from this, and figure out that low taxes draws more investment, driving up employment and productivity, which is good for the economy and the people, probably doing more good than the tax revenue sacrificed ever could. But no, if some countries are more attractive to investors than others, these gentlemen would like them all to be equally unattractive. Go figure.

(Link via email from Gautam John.)
amit varma, 11:35 AM| write to me | permalink | homepage

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