The best way to disincentive tax avoidance would be to not allow it in the first place. A one-off policy like this punishes tax avoidance without necessarily discouraging it in the future. It depends on how likely businesses think it is for something like this to happen again.

I think there is a lot of lobbying for tax avoidance. But maybe that's just my perception of govts using democracy as a banner while in reality policy is much more influenced by lobby effort than voters sentiment.

I'm sure you're right. Lobbying for tax avoidance is a classic example of rent-seeking. I'm just trying to point out that this is an empty gesture from the government. It makes people feel good but it doesn't really prevent tax avoidance in the future. If that was the goal, there's a much more direct way to do it.

That could be the real answer, for sure. Or the aggregate answer, maybe, in the sense of "we need to do X, but can't do too much of Y, because then voters will notice and get angry." In that case, it might not be a deliberate choice at all, just the reality of politics in a democracy.

If it was a deliberate choice, my instinct would be that designing one policy with a dual mandate sounds a lot more complicated and less effective than designing two policies. It's a lot simpler to target a bailout to saving jobs only, say, and then separately change the tax code to disincentivize tax havens. That would also separate the part that needs to be done urgently, from the part we could do whenever.