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This excellent article shows that contrary to the dire predictions of many observers, tax cooperation is still possible among OECD member countries and that such cooperation can overcome the trilemma of maintaining democracy, sustaining globalization and accepting some tax competition. Specifically, the authors show that in the realm of individual tax evasion, the advent of Automatic Exchange of Information (AEol) after the financial crisis of 2008-9 has enabled OECD countries to maintain a higher level of tax on capital than was possible before the crisis. This, in turn, enabled such countries to reduce inequality and maintain the social safety net while retaining the ability to democratically set tax rates and avoiding controls on the free flow of capital. The authors correctly contrast this development with the failure so far to achieve consensus on taxing corporate profits, so that the trilemma persists in regard to that type of capital.


Reprinted from Intertax, 69 (6), 2021, 555-557, with permission of Kluwer Law International.

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