The United States and Britain had a treaty under which they agreed not to tax each other’s companies’ profits. Such double-taxation treaties are foundational to the globalised economy because they ensure that a company that operates in more than one country isn’t taxed twice on the same money… this treaty extended to Britain’s overseas colonies, which exposed a flaw at the heart of this system: if one country undercuts the other on tax rates, companies that base themselves there can dramatically reduce the amount of tax they pay in the other.
Most big countries won’t play this game, because it would destroy their tax bases. The BVI, being small and having a weak economy, had no such considerations because it didn’t have much tax revenue to lose: the new business the islands attracted from relocating companies gained them more in fees than they lost in taxes. Such countries are now understood and referred to as tax havens, but back in the 1970s they were a new phenomenon and businesses were exploring them with relish.
In the 1970s, corporations in the BVI paid 15 per cent tax on their profits, while in the United States they paid 50 per cent. If an American incorporated her business in the Caribbean she could export her dividends and cut her effective tax rate by more than half. All she needed was a local lawyer. And, dating from 1976, when US clients first found him, that lawyer was Michael Riegels…
The extraordinary story of the British ex-pat in the British Virgin Islands who founded the now-global off-shore tax haven “industry,” currently estimated to hold $7-10 trillion in assets (up to 10% of global assets) anonymously and outside the reach of home country authorities: “The Second Career of Michael Riegels.”
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As we salt it away, we might recall that it was on this date, the Ides of March, in 44 BCE that Julius Caesar, who was reputedly “born of the knife” (via cesarean section), died by the knife– stabbed to death by Brutus, Casca, and 58 others in the Roman Senate.
In fact, the early history of cesarean section remains shrouded in myth and is of dubious accuracy. Even the origin of “cesarean” has apparently been distorted over time. It is commonly believed to be derived from the surgical birth of Julius Caesar, however this seems unlikely since his mother Aurelia is reputed to have lived to hear of her son’s invasion of Britain. At that time the procedure was performed only when the mother was dead or dying, as an attempt to save the child for a state wishing to increase its population. Roman law under Caesar decreed that all women who were so fated by childbirth must be cut open; hence, cesarean. Other possible Latin origins include the verb “caedare,” meaning to cut, and the term “caesones” that was applied to infants born by postmortem operations. [source]
The Death of Caesar, Jean-Léon Gérôme, 1867
