FINANCE To what extent have reforms of the international financial architecture benefitted developing countries? Can developing countries break free of Ponzi capitalism?
JP Morgan, ‘Global Tax Rate Makers’ (2012) Many multinationals appear to be centralizing many of their valuable IP [intellectual property] assets in low-tax jurisdictions. The reality is that IP rights are easily transferred from jurisdiction to jurisdiction, and they are often inherently difficult to value.
Microsoft and The Puerto Rico transfer game US$21 billion shifted for a saving of $US4.5 billion in US taxes. In the Irish transfer pricing game Microsoft transferred intellectual property to a Microsoft entity in Dublin that in 2011 reported profits of $4.3 billion on which it paid an effective tax rate of 7.3%.
persuasion warning Civil penalty Criminal Virtuous actors Calculating actor incapacitation Incompetent or irrational actor Enforcement Pyramid
Patent Office Innovation System Regulator e.g Tax Office Regulator e.g. Pharmaceuticals Enforcement Pyramid Network partners from the innovation system Information sharing, task forces, co-ordination Pyramidal Interventions Diagram 1 - A model of responsive institutionalism.