> An international group of bankers, lawyers and stockbrokers - reportedly with links to the City of London - appears to have fiddled the tax system, employing practices which were at best unethical, at worst illegal.
> With a bit of imaginative paperwork, and by exploiting a procedure which allows more than one person or institution to simultaneously own a share, they were able to claim numerous tax refunds. The practice was outlawed in 2012.
In my (incomplete) understanding this was a vulnerability in the law that has not been patched until 2012 when it had already been exploited for a while. It wasn't just tax avoidance but extracting money from treasuries, so it should be blatantly obvious that this was not the intent of the lawmaker.
> In the first type, German banks and stockbrokers bought and sold shares for foreign investors in a way which allowed them to claim a tax refund for which they were not eligible. Many question the legality of the practice.
This is more "nobody noticed they were doing it" than "it was obviously happening, and the government shrugged its shoulders." Obviously, unlike a computer, it is quite possible for humans to just not notice that you're doing an illegal thing.
> In the second (a more complicated variation), investors and banks bought and sold shares just before and just after dividends were paid. With a bit of imaginative paperwork, and by exploiting a procedure which allows more than one person or institution to simultaneously own a share, they were able to claim numerous tax refunds. The practice was outlawed in 2012.
This is a subtle loophole, which probably did not admit an easy patch without serious unintended consequences (the category for which I used Spectre as an example).
A GAAR (which lots of countries have these days) goes roughly like this:
If you do something that only makes sense because it reduces your liability to taxation, that doesn't work, and tax is due as if you hadn't done it.
The UK's version uses a "double reasonableness" test, which tells a jury that the way to assess the rule is not just to decide whether they, ostensibly reasonable people, think the accused did something that makes no sense except to avoid tax, but that they should imagine whether _any_ hypothetical reasonable person could have thought it was reasonable to do this. That's a deliberately high bar for the tax authorities.
I don't think having an Irish subsidiary with four employees that supposedly sells all your products produced in China under direction of staff mostly based in Swindon seems reasonable if not for the tax benefit, but somebody else might reasonably think so, and so I concede that a "double reasonableness" test would allow you to keep claiming the tax benefits of doing that.
On the other hand, if you pay hardly any taxes because you claim to be a "second hand car dealer" but it turns out you never saw any of these cars you were supposedly dealing in, know nothing about cars, and had arranged in advance for the cars to be bought and sold at a calculated loss so as to avoid taxation, now I struggle to imagine how any reasonable person could not see that for what it is, and so (sure enough) real celebrities who tried such a scheme ended up having to pay their taxes (and for the lawyers they'd hired to try to argue this was fine).
Another fun element of GAAR is to require people who sell avoidance schemes to tell you about them. The requirement goes like this. If you sell somebody a tax avoidance scheme that doesn't work you're in hot water _unless_ you told the tax authorities about this scheme first. This way the authorities know what's coming, and the people who dream up schemes keep their income, the only downside is if you're a grifter hoping to avoid taxes it might be less likely to work now. Boo hoo.
That's probably false. It's enough to make sure entities holding shares can never set up a system to avoid paying taxes on them. And in any case holding shares can not result in net gain (so no tax credit can result from holding shares).
The law always can be amended and further complicated, even in inconsistent ways! And let courts sort it out. (And then fix it again, and repeat.)
That sounds exactly like a zero-day bug of the sort that caused e.g. Heartbleed and Shellshock.
Likewise, while starting a country is plausibly a moral good, enabling that is not the purpose of maritime treaties. Countries refuse to recognize other terrestrial countries all the time, even if they have clear borders and obviously-powerful governments internally (e.g. PRC and ROC each refusing to recognize the other, most of the middle east not recognizing Israel). Putting your country on a boat doesn't somehow increase your legitimacy before the international community.
Neither is preventing it. So why is it a 'loophole'. (leaving aside the issue that it would be very hard to justify the legitimacy of such a law)
Says who? this is an arbitrary interpretation.
Further, there is obviously no law about how and where to create a new country, as the UN by definition will defend the status quo as a union of sovereign nations. Most countries emerged violently and illegally in their beginning, and got recognized later (including the US).
The mojave is in the middle of what the world recognizes as a sovereign state, it would be a much more difficult starter and impossible to find allies.
> Says who? this is an arbitrary interpretation.
> Further, there is obviously no law about how and where to create a new country, as the UN by definition will defend the status quo as a union of sovereign nations. Most countries emerged violently and illegally in their beginning, and got recognized later (including the US).
> The mojave is in the middle of what the world recognizes as a sovereign state, it would be a much more difficult starter and impossible to find allies.
I think what amalcom is getting at, is that maritime law does not offer any protection to aspiring nation states. It is in place solely to allow free travel. That same free travel would allow another sovereign who happens upon your budding nation state to take it with impunity (unless the state is prepared for armed conflict with another, more established (and probably more populated and wealthy) state).
It might be two guys with guns, or it might be a huge bureaucracy that runs on the rule of law or anywhere in between.
But it's always there.
You forgot to mention that in that case it's just one guy with the only gun
As soon as one person's actions can affect another person a system arises for resolving their inevitable conflicts and facilitating cooperation if required. What do you call that system? Many would call that "government." That does seem appropriate if the definition of government is:
> the political system by which a country or a community is administered and regulated.
Of course, "government" as manifested in multi-million person nations is significantly evolved from it's abstract underpinnings both etymologically and philosophically. Same is true of the notions of political, community, administered, and regulated. But all that evolution (both its pros and cons) falls out logically from the foundational relationship of two beings with agency trying to figure out how and if to restrain that agency when it conflicts with the other's.
EDIT: I see from a sibling you're referring to "Anarchism." That doesn't free anyone for the reality of government it just changes where the restraining lines get drawn. In practice, the lines predictably get drawn in favor of the powerful just as they do in more mainstream systems of government.
If you find a straightforward loophole in software, the computer running it will e.g. happily hand you information you're not supposed to have[1]. If you find that kind of loophole in the law, then the humans running it will usually just tell you to go home. They know that you know what they meant.
Laws can still have loopholes, but they are generally more subtle and complicated. Fixing them often has obvious unintended consequences. They're more like speculative execution bugs[2] than buffer overruns.
[1]- https://en.wikipedia.org/wiki/Heartbleed
[2]- https://en.wikipedia.org/wiki/Spectre_(security_vulnerabilit...