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The Price We Pay

How offshore havens are silently killing our middle class

Where is ‘offshore’ exactly? That’s one of many provocative questions asked in The Price We Pay, Harold Crooks’s probing documentary on corporate tax avoidance via offshore tax havens.

Poster art for The Price We PayAnd if this doesn’t sound like riveting viewing, hang on a minute. If you care about social inequality, the disparity between rich and poor, the devious financial practices of big business or simply the bottom line of your own income tax bill, pull up a chair.

Multinationals have an array of tricks to keep their money flowing through offshore tax havens, paying little to nothing to local governments. Apple Inc. is based in California, but two-thirds of its profits are funnelled through Ireland, using a tax-avoidance loophole known as the ‘double Irish’ arrangement. Between 10 and 15 per cent of the world’s wealth is stored in tax-free zones, from Singapore to Bermuda and the Cayman Islands.

That’s a lot of potentially taxable income. The fact that it doesn’t find its way back to the countries where these businesses operate puts a major dent in the pocketbooks of everyday citizens, as they are taxed at ever-higher rates to make up for the disparity. The middle class is an endangered species and governments are resorting to so-called austerity measures to make up for missing funds.

London, England, bears much of the blame, having set itself up as a de facto tax haven decades back via a square mile area at its centre run by the City of London Corporation, where wealthy companies can operate free of government meddling.

That led to the Cayman Islands and other British territories following suit. The fact that money doesn’t have to be physically deposited in the Cayman Islands, but can be shuffled virtually, further illustrates how this is all one big shell game.

Crooks interviews a wide range of experts including Quebec tax policy adviser and author Brigitte Alepin, who co-wrote the screenplay, former Wall Street movers and shakers; and French economist Thomas Piketty, author of the bestseller Capital In The Twenty-First Century.

Piketty’s involvement may be part of the reason The Price We Pay has been such a hit in France, even garnering praise from finance minister Michel Sapin. The country is one of the leaders in attempts to change the current climate.

Essential to such endeavours is public awareness of the issues, which Crooks’s film is helping to heighten; and to which you can contribute with a thought-provoking night out at the cinema.

– T’Cha Dunlevy, The Montreal Gazette