Why I love tax havens

And why you should too

A few days ago a friend shared on Facebook the image above. The image was surely intended to provoke outrage, as well it should: the tax avoidance strategies of corporations such as Walmart are offensive and exacerbate the rampant and rising inequalities that scar our world.

But there was another reason for outrage at this image; one that its creator had not anticipated.

It’s not a picture of Luxembourg.
Luxembourg’s Little Switzerland

Luxembourg has rolling hills and even a craggy ‘little Switzerland’, but it has no snow-capped mountains. The picture looks like it could have been taken in Switzerland: a tax haven as notorious as Luxembourg, but not the same country.

Why is this mistake outrageous?

It’s not that Luxembourg doesn’t need to be castigated for its prominent role in helping multinationals avoid tax. But treating Luxembourg as interchangeable with Switzerland implies that as a place it is utterly uninteresting and irrelevant — that, as a tax haven, everything in Luxembourg is reducible to its repellent financial system. And this is outrageous as it shows contempt for the real people, the Luxembourgeoise, who actually live in the small Grand Duchy.

Why do I care so much about Luxembourg? After all, it’s hardly as though they are an oppressed people. Part of the reason, is that I’ve actually been there, and seen its surprising beauty and experienced its quirky culture. I’ve even learned a few words of the Luxembourgish language.

But it’s about more than my own personal love of Luxembourg. The tendency to ignore everything about Luxembourg other than its taxation policy is symptomatic of a wider — and often self-righteous — ignorance about tax havens as real places. And this ignorance isn’t just patronizing, it is self-defeating if we are to have any hope of turning these places away from the tax avoidance industry.

I recently read a beautiful book called The Heavens: Annual Report, a collaboration between the photographers Paolo Woods and Gabriele Galimberti, together with the writer Nicholas Shaxson, who has spent years investigating tax havens. The book features beautiful, and often carefully staged, photographs of tax havens such as the British Virgin Isles, The Cayman Islands, Panama, Singapore and others, together with an extended and devastating essay by Shaxon that reveals the damage these places do.

While the book succeeds as art and as polemic, there’s something missing in most the photos. Aside from a few that reveal the hidden poverty in some of these places, most of them suggest that these tax havens are empty, sterile, devoid of life and character. Just like the Facebook image, the places in The Heavens are reducible to their tax haven status, interchangeable, somehow worthless.

The problem is that this common approach to tax havens is not only unfair, it offers no hope from turning these places away from financial chicanery. If Luxembourg, Monaco or Jersey are to forge a new path, they need to perceive a future for themselves in a globalized world, they need to see themselves as unique, as precious, as having something distinctive to offer. Yet when those who oppose tax avoidance treat them as empty, sterile, interchangeable places, those who live in them are hardly likely to have the confidence to change.

And that’s why I’ve committed myself to finding things to love about tax havens — and why you should do too. I try and look behind the brass plate companies, the laundered drug money and the local elites to their real hidden treasures. Often the best place to start is language. Did you know that Jersey and Monaco have their own local — and endangered — languages? Well you should. And there’s much else to discover too: the ethnic syncretism of Gibraltar, the musical fusions of the Cayman Islands, the indigenous peoples of Panama.

If we love them, maybe they will love us back — and stop helping our corporations avoid tax.