Black Money and Financial Networks: The Global Role of the UK
Black Money and Financial Networks: The Global Role of the UK
What is the UK's Financial Secrecy and the Flow of Black Money?
After World War II, the UK started financial regulations amid
an economic crisis and conflicts with capitalists,
which is considered a dark chapter in history.
The City of London transitioned from pound-based
loans to dollar loans with stricter lending regulations,
opening the era of offshore finance.
The Eurodollar and Euromarket were financial markets formed
by the influx of US dollars into the UK,
operating freely by avoiding regulations and becoming a hub for money laundering.
The UK's Financial Network and Global Issues
The UK maintains a financial system that supports tax evasion and
illegal money inflows, with examples
including the Bahamas and the Cayman Islands.
After the Suez Canal crisis, London continued to use its imperial legacy,
remaining the center of global finance.
Hong Kong functioned as a route for Chinese billionaires to move capital,
and the UK used this to expand its influence.
In the 2008 AIG scandal, the London branch caused problems,
highlighting the risks of offshore finance.
A free financial system eventually led to
government intervention and the burden on taxpayers.
What is the Problem of Financial and Tax Evasion?
Some argue that they contribute to the economy without paying taxes,
but these claims are supportive of the system.
The structure, which favors the wealthy, causes money
to flow out of the country, exploiting its wealth.
There is criticism that the flow of money in finance
resembles colonial exploitation.
In the US, certain states serve as tax havens,
and places like Delaware attract companies with low corporate taxes,
but this causes financial imbalances between states.
The Relationship Between Global Finance and Tax Evasion
Decentralization triggers corporate tax competition,
making capital flow more active.
When Delaware lowers its corporate tax rates,
other states are pressured to follow suit.
In 2012, President Obama pointed out that
US capital was moving to offshore tax havens.
As financial regulations loosened, corporations sought to evade taxes,
with the actual corporate tax rate paid being only 3.3%.
Ultimately, governments bear the financial risks with taxpayers' money.
The UK's Response to Black Money Issues
As countries intensify pressure on black money,
the UK's response has attracted attention.
While the UK criticizes tax havens,
it continues to perform well in the financial sector.
Through an OECD agreement, the UK secured an exemption
for the financial sector from digital tax measures,
reflecting the country's reliance on finance.
Some countries provide services restricted to foreigners to generate profits,
revealing the complex relationship between nations and capital,
with cultural differences acting as significant barriers to resolving the issue.
Editor - 떼수산