Economic history has a way of shifting in life cycles. The Bretton Woods era and the Marshall Plan set the stage for the post-Second World War economic order. The launch of the World Trade Organisation and the Brady Plan for debt shaped the post-Cold War Golden Era of globalisation.
Ms Yellen’s push for a baseline on corporate taxation comes as policymakers seek to lay the foundations for a post-Covid-19 and increasingly carbon-neutral economy.
While a global standard for corporate taxes may sound dry, it in fact represents a step change from capitalism as we know it. Taken in a context of rising progressive pressure for reparations for colonial economic exploitation, the move lays the groundwork for something quite dramatic.
The intellectual sands within the economic profession have rapidly shifted. Many think Ms Yellen’s idea is far too modest. Some propose new variations on transaction taxes, such as a levy on all share price values or on digital activity.
Resistance should be straightforward for Ms Yellen to overcome. The private economy is benefiting from the second mass mobilisation of resources to stabilise and recapitalise the economy in less than 11 years.
When the finance ministers of the International Monetary Fund and World Bank met recently, Washington proposed a global plan for uniform rates. The kicker is that countries would be able to apply the taxes if earnings in other states were taxed at a lower rate to make up the difference. That would effectively reduce incentives for US corporates to shift profits to low-tax nations that have prioritised development over government revenues.
Some developed countries have already responded to the pandemic by reversing the trend towards lowering corporation taxes, such as the UK. The 37 members of the Organisation for Economic Co-operation and Development are looking to seal a deal on a digital services tax and corporate taxes by the middle of this year.
International agreement is necessary because the existing cross-border taxation treaties only allow countries to impose taxes on businesses with a permanent presence in their borders. This allows plenty of booking of revenues or profits offshore, effectively eliminating the taxman.
The signing of the Bretton Woods Agreements in July 1944. The Bretton Woods era and the Marshall Plan set the stage for the post-Second World War economic order. Getty Images
European countries have been embroiled in a tariff war with the US over their attempts to impose Digital Sales Taxes on companies. Washington believes these discriminate against the mighty US presence in the sector.
Abandoning this approach would not have any great cost for the Europeans, as the digital taxes imposed so far have not raised much revenue for governments. In a report last week, the Centre for European Reform said “a deal broadly around the current US proposal is a realistic possibility and is in the EU’s interest”.
The direction of travel is moving to a burden-sharing ethos by taking from privately held wealth to the governments.
A study by Emmanuel Saez and Gabriel Zucman, who work at University of California in Berkeley, calls on companies to pay 0.2 per cent of stock market valuation in taxes. "As the G20 stock market capitalisation is around $90tn, the tax would raise approximately $180 billion each year," their report said. That is, of course, puny compared to the $2tn infrastructure proposal Mr Biden is pushing in the US alone.
French economist Thomas Piketty has called for a historic set of payments between colonial exploiters and the developed countries.. Alamy
The direction of travel is moving to a burden-sharing ethos by taking from privately held wealth to the governments
Thomas Piketty, the leftist French economist, asks why not also look at making a historic set of payments between colonial exploiters and the developed countries. This healing gesture would chime with those who have protested outside institutions and businesses with ties to slavery and other global ills.
The godfather of "social tax justice" sees much greater challenges ahead. He sees the benefits of tax reforms accruing in developed countries and cutting out the developing nations. Using a case study of Haiti, Mr Piketty wants Paris to hand over 300 per cent of that country’s GDP, or $30bn. Such a sum is one per cent of French public debt but would make a massive difference to the stricken Caribbean country’s outlook.
He argues that inequality of wealth and poverty must be addressed on an international basis and within countries.
Government spending is a means of intervening against these trends. By internationalising the issue, Washington would give new respectability to a much greater rebalancing of the global wealth scales.
Damien McElroy is the London bureau chief at The National
Cost: Entry is free but some events require prior registration
Where: Various locations including National Theatre (Abu Dhabi), Abu Dhabi Cultural Center, Zayed University Promenade, Beach Rotana (Abu Dhabi), Vox Cinemas at Yas Mall, Sharjah Youth Center
What: The Korea Festival will feature art exhibitions, a B-boy dance show, a mini K-pop concert, traditional dance and music performances, food tastings, a beauty seminar, and more.
Although you can buy gold easily on the Dubai markets, the problem with buying physical bars, coins or jewellery is that you then have storage, security and insurance issues.
A far easier option is to invest in a low-cost exchange traded fund (ETF) that invests in the precious metal instead, for example, ETFS Physical Gold (PHAU) and iShares Physical Gold (SGLN) both track physical gold. The VanEck Vectors Gold Miners ETF invests directly in mining companies.
Alternatively, BlackRock Gold & General seeks to achieve long-term capital growth primarily through an actively managed portfolio of gold mining, commodity and precious-metal related shares. Its largest portfolio holdings include gold miners Newcrest Mining, Barrick Gold Corp, Agnico Eagle Mines and the NewMont Goldcorp.
Brave investors could take on the added risk of buying individual gold mining stocks, many of which have performed wonderfully well lately.
London-listed Centamin is up more than 70 per cent in just three months, although in a sign of its volatility, it is down 5 per cent on two years ago. Trans-Siberian Gold, listed on London's alternative investment market (AIM) for small stocks, has seen its share price almost quadruple from 34p to 124p over the same period, but do not assume this kind of runaway growth can continue for long
However, buying individual equities like these is highly risky, as their share prices can crash just as quickly, which isn't what what you want from a supposedly safe haven.
Academics: Phd in strategic management in University of Wales
Number one caps: His best-seller caps are in shades of grey, blue, black and yellow
Reading: Is immersed in books on colours to understand more about the usage of different shades
Sport: Started playing polo two years ago. Helps him relax, plus he enjoys the speed and focus
Cars: Loves exotic cars and currently drives a Bentley Bentayga
Holiday: Favourite travel destinations are London and St Tropez
How England have scored their set-piece goals in Russia
Three Penalties
v Panama, Group Stage (Harry Kane)
v Panama, Group Stage (Kane)
v Colombia, Last 16 (Kane)
Four Corners
v Tunisia, Group Stage (Kane, via John Stones header, from Ashley Young corner)
v Tunisia, Group Stage (Kane, via Harry Maguire header, from Kieran Trippier corner)
v Panama, Group Stage (Stones, header, from Trippier corner)
v Sweden, Quarter-Final (Maguire, header, from Young corner)
One Free-Kick
v Panama, Group Stage (Stones, via Jordan Henderson, Kane header, and Raheem Sterling, from Tripper free-kick)
Five expert hiking tips
Always check the weather forecast before setting off
Make sure you have plenty of water
Set off early to avoid sudden weather changes in the afternoon
Wear appropriate clothing and footwear
Take your litter home with you
Polarised public
31% in UK say BBC is biased to left-wing views
19% in UK say BBC is biased to right-wing views
19% in UK say BBC is not biased at all
Source: YouGov
Tell Me Who I Am
Director: Ed Perkins
Stars: Alex and Marcus Lewis
Four stars
What are the influencer academy modules?
Mastery of audio-visual content creation.
Cinematography, shots and movement.
All aspects of post-production.
Emerging technologies and VFX with AI and CGI.
Understanding of marketing objectives and audience engagement.
Tourism industry knowledge.
Professional ethics.
THE SPECS
2020 Toyota Corolla Hybrid LE
Engine: 1.8 litre combined with 16-volt electric motors
