The pot of gold is here, not in tax havens.

" We are strongly committed to a global response to cross-border tax avoidance and evasion so that the tax system supports growth enhancing fiscal strategies and economic resilience," reads a communique after the G20 meeting at Cairns in Australia. We say," Hear, hear," to that. But how? The corporate tax rate in India is 34%, more than double that in Mauritius where it is a pleasing 15%. India has a Double Tax Avoidance Treaty with 88 countries. Why would a company pay a humongous 34% tax plus a forced 2% Corporate Social Responsibility expenditure in India when they pay 12% in Cyprus, 12.5% in Ireland and no tax in the Channel Islands of Jersey and Guernsey? Chairmen of multinationals maybe anything but they definitely are no fools. But India is not alone. Apple pays almost no taxes in the US by ascribing all its profits to a postbox company in Ireland, which has no employees, and then pays no tax in Ireland because this company is controlled from the US. The beauty is that Apple has not broken any laws. The big 4 accounting firms rake in billions of dollars in earnings every year by advising companies and wealthy people on how to avoid taxes, without breaking any law. The US is losing tax revenues as large companies relocate their headquarters to other countries with lower rates of taxes. The practice of merging with an overseas subsidiary in order to shift tax base to a country with lower tax rates is called ' inversion ' in the US and so enraged Obama that he called it " unpatriotic ". Politicians may keep frothing but there is nothing they can do about it. Taxation is a sovereign right of any government and if a country has kept its tax rates low, in the hope of attracting businesses which will create employment, which will increase demand and thus stimulate growth, then good luck to it. Indian politicians and civil servants are a mixture of totally shameless beggars with openly criminal aggression in their demands for unjustified entitlements. To soothe the public to their complete lack of sharam and izzat they resort to naked bribes in the form of handouts under various social schemes. Giving free electricity to farmers has crippled the electricity industry and has added to the cost of living by increasing charges for those who pay. This has been aggravated by mining scams where mines were given to friends and family so that coal has to be imported when India has 250 billion tonnes of reserves. To fill the huge hole in its budget the government resorts to extortionate taxes which undermine competitiveness as investments fall. Our politicians have excited the people on how they will get billions of dollars of illicit money stashed abroad when most of the loot is invested in the real estate sector inside India. India's problems cannot be solved by the G20. The crooks are here. Get them first.