Migration and sovereignty EQ2.3 Flashcards
What is one way that countries can attract more Foreign Direct Investment?
Reduce restrictions on who can invest
Define tax haven
When some nations offer low or zero tax regimes, which provide a shelter from government taxation
Give three examples of low tax regime states
Ireland
Luxembourg
Cayman Islands
Name three facts about the Cayman Islands
They offer a 0% personal tax rate
116,996 companies were registered on the island
This includes 43 out of 50 largest investment banks in the world
Tax havens offer a way of?
Avoiding paying tax
What do tax havens encourage?
Corruption
Define corporate profit shifting
Where a TNCs headquarters is located in a low tax country and therefore profits are registered there
Namer three advantages of tex havens
Tax havens can develop quickly and recover from recessions even quicker
Taxing TNCs in multiple locations is considered unfair therefore tax havens offer a centralised tax centre
Governments and IGOs are more accepting of tax havens and tax avoidance due to the economic boost and growth they deliver
Name three disadvantages of tax havens
Increased corruption in LDEs and HDEs due to a lack of income being declared
Investing abroad reduces money available to invest in their own country
Less money available for domestic services such as education and health
Name the growing global inequalities on the global economic system
Economic instability
Poor health
Crime and violence
Low social mobility and education
Trust,participation and happiness
Political instability
What is the Gini Coefficient
A statistical measure in analysing income distribution within a nation or social group
What scale is the mini coefficient measured on?
0-100, with 100 being the highest inequality
What kind of countries are higher wealth inequalities seen in and why?
HDEs because of the higher range of wages available
