Features
Janet Yellen Proposes to Revolutionize Corporate Taxation!
by Selvam Canagaratna
President Biden is proposing a substantial increase in the rate of corporate taxation as part of his infrastructure plan, bumping the headline rate up from 21 percent to 28 percent. This is actually below where it was before 2017, when the headline rate was 35 percent, but given the number of loopholes in the tax code, very few corporations actually paid full whack back then. If Biden’s idea is passed, the effective rate of US corporate tax will depend on what happens with those loopholes in Congress, which is not yet clear.
More importantly, writes Ryan Cooper, Treasury Secretary Janet Yellen is leading an effort to implement a global minimum corporate tax. This would be one of the most revolutionary economic agreements in history — blowing up the model of tax havens around the world, and drastically shifting the balance of power between corporations and national governments (especially small ones).
The last several decades have seen a race to the bottom in corporate tax rates around the world, as economists Emanuel Saez and Gabriel Zucman describe in their book Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay.
America, for example, used to have very steep taxes on the rich — a 53 percent tax on corporate profits, a 75 percent tax on the biggest inherited estates, and a 94 percent top marginal income tax rate.
Figures from economist Thomas Piketty show similar rates in France, Germany, and Britain in the period after the Second World War. But these have been gradually whittled away over the years through a combination of legal innovation from tax lawyers and accountants, and learned helplessness on the part of governments — especially after the neoliberal turn in the 1980s, when taxes came to be viewed as an economic drag if not legalized theft. In 1980 the average corporate tax rate in Europe was about 45 percent; in 2020 it was about 20 percent. “Looking at most of the great retreats of progressive taxation, we find the same pattern: first, an outburst of tax dodging; then, governments lamenting that taxing the rich has become impossible and slashing their rates,” they write.
Thanks to all the succeeding rounds of tax cuts, today ultra-billionaires pay less in tax than any other group in the US. According to data compiled by Saez and Zucman, people on the Forbes 400 list of the richest people in the country pay just 23 percent of their income in tax, as compared to about 40 percent for the upper-middle class or 28 percent for the very poorest:
It is of course wildly outrageous for the most well-off people to be contributing so little to support the country that makes their wealth possible, and the gigantic concentration of money in so few hands is manifestly corrupting politics around the world. Low corporate taxes are a big reason for this — as you can see with their handy tool, increasing the effective corporate rate to 40 percent would bump up the Forbes 400 tax rate by about 7 percentage points.
But perhaps more insidious still is the politics of tax havens created by all these cuts.
One of the key legal strategies that corporations use to avoid tax is by stashing their money overseas. Google, for instance, books much of its profit in Ireland, where the headline corporate tax rate is 12.5 percent (and in practice lower than that) and Bermuda, where the corporate tax is zero. As Saez and Zucman explain, companies do this basically through trickery. By selling assets that have no market price (above all intellectual property) to foreign subsidiaries for cheap, they can then book profits relating to those assets there and pay little in tax.
In an economic sense, this is tantamount to fraud. There is not anything like the level of business activity that would justify all those profits being “made” in Ireland or Bermuda. They are overwhelmingly profits made elsewhere that are sheltered from tax authorities through accounting gimmicks.
But the ability to book profits in tax havens provides corporations with a powerful weapon against national tax authorities. By moving profits overseas (or threatening to do so), they have induced nations to continually cut their domestic corporate tax rates, inaugurating a race to the bottom as countries struggle to undercut each other.
In 1980, the average corporate rate was 40.11 percent, but today it is just 23.85 percent. There have always been countries that charged little in corporate tax, but as Saez and Zucman demonstrate, before the 1970s they were not used to book fake profits, for fear of a crackdown from the IRS or other tax authorities. But once authorities in rich countries gave up trying to rein in tax cheats, evasive behaviour exploded: Between 1980 and today, the percentage of foreign profits booked by US-based multinational corporations in tax havens has tripled, from less than 20 percent to almost 60 percent. There is no sign of the trend stopping, either — in 2020 alone, nine countries cut their corporate rate.
Now, America is so big and powerful that it could probably destroy tax havens by itself. Biden’s tax plan would double the tax rate US companies pay on their foreign profits, which would strike a substantial blow by itself. But America could also legally forbid the use of tax shelter accounting strategies for American companies, and require that any international company doing business here do the same — forcing them to book British profits in Britain, German profits in Germany, and so on. Any serious multinational must have access to the vast American domestic market, and they would basically have no choice but to comply. In the extreme, the US could apply economic sanctions to tax havens or even threaten them with military force.
But Yellen is pushing a different argument. The corporate tax race to the bottom is a poisonous zero-sum game — the benefits to Ireland or Bermuda must come at the expense of other countries, and erode the global rate of corporate tax over the long term. It follows that it is in the interest of all nations to set up a universal minimum standard so that nobody is tempted to go for beggar-thy-neighbour development strategies. That holds even for Ireland, where the flood of corporate money has badly corrupted national politics, and the average Irish person barely sees any of those fake profits anyway.
“This is not sustainable, either politically or economically,” Zucman told The Week. “A high global minimum tax would address the issue — and ultimately allow the world to reconcile globalization with tax justice.” The rate of the minimum tax is still being discussed, but if set at a reasonable level, it would be a huge blow against corporate power. In effect, nations would regain a great deal of economic sovereignty — allowing them to choose corporate policies based on what they think is best, rather than being forced to follow the herd and prostrate themselves before the corporate elite.
It is an interesting question as to why Democratic establishment types like Biden and Yellen are pushing this kind of fairly aggressive policy. The complete failure of the Trump corporate tax cuts to perform as promised probably has something to do with it. According to neoliberal economic theory, such cuts should spark investment because companies will get to keep a greater share of the revenues resulting from that investment. That did not happen because of inequality — the mass of American consumers did not have the money to buy the products that new investment would have produced and corporations were already sitting on record hoards of cash. Corporate investment is only surging now thanks to all the money put into ordinary people’s pockets through the various pandemic rescue packages, which has spiked demand for all sorts of things.
At any rate, it remains to be seen whether Biden’s tax plan can get through Congress. But Yellen could still accomplish a great deal without that happening. If a critical mass of countries can agree to stand together against big corporations, politics around the world would take a sharp turn for the better. Ultimately, corporations depend utterly on state laws and structures to exist at all. It’s only fair to make them pay their fair share.
Features
Viktor Orban, Benjamin Netanyahu and Donald Trump: The Terrible Threes of the 21st Century
In the autumn of 1956, Hungary staged the first uprising against the 20th century Soviet behemoth. Seventy years later, in the spring of 2026 Hungary has delivered the first electoral thrashing against 21st century right wing populism in Europe. The 1956 uprising was crushed after seven days. But the opposition scored a landslide victory in Hungary’s parliamentary election held on Sunday, April 12 and. Viktor Orban, Prime Minister since 2010 and the architect of what he proudly called “the illiberal state”, was resoundingly defeated. Orban who has been a pain in the neck for the European Union was a close ally of US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu.
Trump even dispatched his Vice President JD Vance to Budapest to campaign for Orban. After Orban’s defeat, Trump and his MAGA followers may be having nightmares about the US midterm elections in November. Similarly, Orban’s defeat has reportedly caused “great concern in the halls of power in Jerusalem.” Netanyahu has lost his only ally in the European Union and the opposition victory in Hungary does not augur well for his own electoral prospects in the Israeli elections due in October.
Ceasefire Hopes
Trump and Netanyahu have bigger things to worry about in the Middle East and among their own political bases. Trump is going bonkers, blasphemously imitating Christ and badmouthing the Pope, launching a blockade in the Strait of Hormuz and strong arming more talks in Islamabad. Netanyahu has been forced to sit on his hands, pausing his fight against Iran while pursuing peace talks with Lebanon. The leaders and diplomats from Pakistan, Egypt and Turkey are shuttling around drumming up support for another round of talks in Islamabad and a prolonged extension of the ceasefire.
Further talks in Islamabad and potential extension of the ceasefire received a new boost by Trump’s announcement of a new 10-day ceasefire between Israel and Lebanon. The background to this development appears to be Iran’s insistence on having this secondary ceasefire, and Trump insisting on ceasefire abidance by Hezbollah in return for his ordering Netanyahu to stop his brutal ‘lawn mowing’ in Lebanon. All of this might seem to augur well for a potential extension of the primary ceasefire between the US and Iran. There are also reports of the narrowing of gap between the two parties – involving a potential moratorium on Iran’s uranium enrichment, the opening of the Strait of Hormuz, and Iran’s access to its frozen assets estimated to be $100 billion.
Meanwhile the IMF has released its latest World Economic Outlook with a grim forecast. “Once again, says the report, “the global economy is threatened with being thrown off the course – this time by the outbreak of war in the Middle East.” Before the war, the IMF was expected to upgrade its growth forecasts for the global economy. Now it is going to be weaker growth and higher inflation with oil price optimistically stabilizing around $100 a barrel in 2026 and $75 a barrel in 2027. In a worst case scenario, if the oil prices were to hit $110 in 2026 and $125 in 2027, growth everywhere will further weaken and inflation will go further up in countries big and small.
In a joint statement on the Middle East, the Finance Ministers of the United Kingdom, Australia, Japan, Sweden, Netherlands, Finland, Spain, Norway, Republic of Ireland, Poland and New Zealand have called on the IMF and World Bank “to provide a coordinated emergency support offer for countries in need, tailored to country circumstances and drawing on the full range and flexibility of their tool kits.” They have also welcomed “advice on domestic responses that are temporary, targeted, and effective, and encourage work to identify steps needed to protect long-term growth.”
Subversion from the Right
The two men, Trump and Netanyahu, who started the war and precipitated the current crisis are not being held accountable by anyone and they are still free to do what they want and as they please. The third man, Victor Orban, who did not have anything to do with the war but extended wholehearted ideological and political support as a faithful apprentice to the two older sorcerers, has been democratically defeated. Together, they formed the terrible threes of the 21st century, spearheading a subversion from the right of the emerging liberal status quo of the post Cold War world. Orban’s defeat is a significant setback to the illiberal right, but it is not the end of it.
The three emerged in the specific historical contexts of their own polities that are both vastly different and yet share powerful ingredients that have proved to be politically potent. The broader context has been the end of the Cold War and the removal of the perceived external threat which opened up the domestic political space in the US, for locking horns over primarily cultural standpoints and climate politics. This era began with the Clinton presidency in 1992 and the election of Barack Obama 16 years later, in 2008, created the illusion of a post-racial America.
In reality, the right was able to push back – first with the younger Bush presidency (2000-2008) pursuing compassionate conservatism, and later with the foray of Trump (2016-2020) threatening to end what he called the “American Carnage.” Of the 32 years since the election of Bill Clinton, Democrats have controlled the White House for 20 years over five presidential terms (Clinton – two, Obama – two, and Biden -one), while the Republicans won three terms (Bush – two, Trump – one) spanning 12 years.
Trump has since won a second term for another four years, but already in his five+ years in office he has issued executive orders to roll back almost all of the liberal advancements in the realms of civil rights, equality, diversity and inclusion. All that the celebrated acronym DEI (Diversity, Equality and Inclusion) stands for has been executively ordered to be banished from the state, its agencies and its programs.
In Europe, the European Union became the champion and bulwark of liberalism and subsidiarity, which in turn provoked the rise of right wing populism in every member country. Brexit was the loudest manifestation against what was considered to be EU’s overreach, but after Britain’s bitter Brexit experience the populists in the European countries gave up on demanding their own exit and limited themselves to fighting the EU from their national bases.
Viktor Orban became the face and voice of anti-EU nationalists. But he and his political party, the Christian Nationalist Fidesz – Hungarian Civic Alliance, are not the only one. Nigel Farage’s Reform UK in Britain and Marine Le Pen’s National Rally Party in France are becoming real electoral contenders, while right wing presidents have been elected in Argentina and Chile.
The rise and fall of Viktor Orban
Of the three terribles, Orban is the youngest but with the longest involvement in politics. Born in 1963, Viktor Orban became a political activist as a 15-year old high schooler, becoming secretary of a Young Communist League local. He continued his activism while studying law in Budapest, visiting Poland and writing his thesis on the Polish Solidarity movement, giving lectures in West Germany and the US as a potential future Hungarian leader, and undertaking research on European civil society at Pembroke College, Oxford.
At the age of 26, Orban gained national prominence with a speech he delivered on June 16, 1989 in Budapest’s Heroes’ Square to mark the reburial of Imre Nagy and other Hungarians killed in the 1956 uprising. Imre Nagy was the leader of the 1956 Hungarian uprising against the puppet Soviet Union outpost in Budapest.
To digress and make a local connection – the pages of Sri Lanka’s parliamentary Hansard of 1956, contain an impressive record of the political debate in Sri Lanka over the events in Hungary. The LSSP’s Colvin R de Silva eloquently led the Trotskyite prosecution of the Soviet invasion of Hungary and the suppression of its freedoms. Pieter Keuneman of the Communist Party used his wit and debating skills to defend the indefensible. GG Ponnambalam, the unrepentant anti-communist, used the opportunity to take swipes on both sides. Finally, for the government, Prime Minister SWRD Bandaranaike deployed his own oratorical skills to empathize with the uprising without condemning the USSR. The four men were Sri Lanka’s foremost verbal gladiators and they used the occasion to put on quite a display of their talents.
Back to Hungary, where Orban began his political vocation identifying himself with Imre Nagy and demanding the withdrawal of the Soviet army from Hungary and calling for free elections in that country to elect a new government. That same year in 1989, Fidesz was recognized as a political party; Orban became its leader four years later in 1993 and led the party and its allies to their first victory and formed a new government in 1998. At age 35 Orban became the second youngest Prime Minister in Hungary’s history.
During his first term, Orban started well on the economy, reducing inflation and the budget deficit, was welcomed to the White House by President George W. Bush, and led Hungary to join NATO overruling Russian objections. But the slide into authoritarianism and corruption was just as quick, including the attempt to replace the two-thirds parliamentary majority requirement by a simple majority. By the end of the term the ruling coalition disintegrated and Orban lost the 2002 election and became the leader of the opposition over the next two terms till 2010.
Orban returned to power with a two-thirds majority in 2010 and immediately introduced a new constitution that set the stage for ushering in the illiberal state. What had been previously a communist state now became a Christian state where ‘traditional values’ of gender rights, sexuality, and exclusive nationalism were constitutionally enshrined. The electoral system was changed reducing the number parliamentarians from 386 to 199 – with 103 of them directly elected and 93 assigned proportionately. Orban went on to win three more elections over 16 years – in 2014, 2018 and 2022 – each with a two-thirds majority, and used the time and power to transform Hungary into a conservative fortress in Europe.
The new constitution and its frequent amendments were used to centralize legislative and executive power, curb civil liberties, restrict freedom of speech and the media, and to weaken the constitutional court and judiciary. It was his opposition to non-white immigration that made him “the talisman of Europe’s mainstream right”. He described immigration as the West’s answer to its declining population and flatly rejected it as a solution for Hungary. Instead, he told his compatriots, “we need Hungarian children.” His ‘Orbanomics’ policies restricted abortion and encouraged family formation – forgiving student debt for female students having or adopting children, life-long tax holiday for women with four or more children, and sponsoring fixed-rate mortgages for married couples.
Orban wanted to make Hungary an “ideological center for … an international conservative movement”. Orban heaped praise on Jair Bolsonaro for making Brazil the best example of a “modern Christian democracy.” He endorsed Trump in every one of Trump’s three presidential elections, the only European leader to do so. In return, Orban has been described by US MAGA ideologue Steve Bannon as “Trump before Trump.” Orban’s attack on universities for being the citadels of liberalism have found their echoes in Trump’s America and Modi’s India.
For all his efforts in making Hungary a conservative ideological centre, Viktor Orban’s undoing came about because of Hungary’s growing economic crises and the depth of corruption and systemic nepotism that engulfed the government. The economy has tanked over the last three years with rising prices and the national debt reaching 75% of the GDP – the highest among East European countries. Orban’s critics have exposed and the people have experienced systemic corruption that enabled the siphoning of public wealth into private accounts, the creation of a ‘neo-feudal capitalist class’, and the enrichment of family and friends. Orban’s corruption became the central plank of the opposition platform that Peter Magyar and his Tisza Party presented to the voters and caused his ouster after 16 years.
The Prime Minister elect is not a dyed in the wool liberal, but a member of a conservative Budapest family, and a politician cut from the old Orban cloth. Magyar (literally meaning “Hungarian”) was once a “powerful insider” in the Fidesz government – notably active in foreign affairs, while his ex-wife was once the Minister of Justice in Orban’s cabinet. Mr. Magyar may not fully roll back all of Orban’s illiberalism, but he has committed himself to eliminating corruption, increasing social welfare spending, limiting the prime ministerial tenure to two terms, and being more pro-European, EU and NATO.
EU and European leaders have openly welcomed the change in Hungary, and may be looking for the new government to change Orban’s vetoing of a number of EU initiatives, especially those involving assistance to Ukraine. In return, the new government in Hungary will be expecting the unfreezing of as much as $33 billion funds that the EU extraordinarily chose to freeze as punishment for Orban’s illiberal initiatives in Hungary. For Trump and Netanyahu, the defeat of Viktor Orban removes their only ally and supporter in all of Europe.
by Rajan Philips
Features
ICONS:A Dialogue Across Centuries
Sky Gallery of the Fareed Uduman Art Forum is dedicated to bringing audiences, cultures, and time periods together through meaningful and accessible art experiences to create the closest possible encounters with the world’s greatest paintings. Previous exhibitions include, Gustav Klimt, Frida Kahlo, Paul Gauguin, Vincent Van Gogh, Salvador Dali.
ICONS is conceived as “a dialogue across centuries” bringing together over a dozen artistic geniuses whose works span the Renaissance to the modern era. These works at their original scales of creation changes the conversation. You can finally stand in front of a life-size Vermeer or a monumental Monet and feel the dialogue between artists who never met but shaped each other across time. Each exhibit is meticulously presented on canvas, hand-framed, and finished at the exact dimensions of the original masterpieces, preserving the integrity of composition, texture, brushwork, color and scale.
At the heart of the exhibition is Jan van Eyck’s ‘Arnolfini Portrait’, a work that epitomizes the detail, symbolism, and human intimacy that have inspired generations of artists. Alongside it, visitors will encounter paintings that shaped the renaissance, impressionism, modernism, and the evolution of visual storytelling by Munch, Matisse, Monet, Degas, Da Vinci, Renoir, Vermeer, Rembrandt, Cézanne, Caravaggio, and more. The exhibition invites audiences to experience a rare conversation across centuries of artistic brilliance.
By bringing together works that are geographically and historically dispersed, ICONS creates a compelling space for comparison, reflection, and discovery. Visitors are invited to move beyond passive viewing into a more engaged encounter—tracing artistic influence, identifying stylistic shifts, and uncovering unexpected connections between artists who never shared the same physical space, yet remain deeply interconnected across time.
Designed and curated for both seasoned art enthusiasts and first-time visitors, ICONS offers an experience that is at once educational, immersive, and accessible—removing many of the traditional barriers associated with global museum-going.
Exhibition Details:
Dates: April 24 – May 3
Time: 10:00 AM – 5:00 PM (Monday – Sunday)
Venue: Sky Gallery Colombo 5
Features
Our Teardrop
BOOK REVIEW
Ranoukh Wijesinha (2026)
Published by Jam Fruit Tree Publications.
82 pages. Softcover. ISBN 978-624-6633-81-3
The author is a graduate teacher at St. Thomas’ College, Mount Lavinia; his alma mater. On leaving school he read for a Bachelor of Arts Degree in English Language and English Literature at the University of Nottingham (Malaysia). On graduating, in 2024, he went back to his old school to teach these same disciplines. There seems to be a historic logic to this as his grandfather, a notable Thomian of his day, also started his working career as a teacher at the College before moving on to the world of publishing; as a newspaper journalist and sub-editor.
On his maternal side, Wijesinha’s grandfather was an accomplished journalist, thespian and playwright of his day, and his mother is also a much sought after teacher of English and English Literature and, as acknowledged by him, his first, and foremost, English teacher.
Though there are some well-written, almost lyrical, pieces of prose in this publication, it is the poetry that dominates. Written with a sensitivity to people and events he has either observed himself, or as described to him by those who did, it also encompasses all genres of poetic verse, from the classical to the modern, including sonnets, acrostics, haiku to free and blank verse, the latter more in vogue today. All in all, it presents as a celebration of English poetry and its ability to, sometimes, express depth of thought and feeling far better than prose.
Dedicated to his mentor at St. Thomas’, his Drama and Singing Master had been a great influence on Wijesinha His sudden, premature, death understandably came as a shock to the still developing student under his tutelage. The poems “The Man who Made Me” and “The Curtain Called” best demonstrate this. In addition, it is apparent that Wijesinha has endured much mental trauma in his young life. Spending much time on his own, the questions these moments have raised are expressed in “When No One is Listening”, “There was a Time”, “Midnight Walks” and the prose “A Ramble through Colombo”.
However, the majority of the poems concern ‘Our Teardrop’, Sri Lanka, for whom the writer has a great love. He explores its history, its natural wonders, its people, its tragedies, its corruption and the hope that things will get better for all its people. “Bala’ and “Dicky” address a time of violence from days gone by when there were few glories, just victims. “Easter Sunday” brings this almost to the present time.
There also is humour. “Ado, Machang, Bro, Dude” celebrates his friends and friendships in a way that will reverberate with all the present and previous generations of those who are, or were once, in their late teens and early twenties.
There is little to criticise in this first of the writer’s forays into published works except, as referred to previously, to re-state that the prose quails in the face of the power of the poetry. It is all well written, filled with passion and compassion, and gives comfort that there still are young Sri Lankan writers who can be this brave, and write so powerfully, and profoundly, in English. It is hoped that this is just the first of many from the pen of this young writer.
L S M Pillai
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