A good century for tax?: Globalisation, redistribution and tax avoidance
At the beginning of twentieth century, Western economies were organised well enough to be able to collect income or company tax: it was more practical to focus on the customs barrier. In 2000, Christopher Hood said that the twentieth century had been 'a great century for tax collection by Western governments'. Income tax, company tax and sales tax steadily increased the government share of gross domestic product during the twentieth century and this was the general trend throughout the West. Tax avoidance is a problem of globalisation. Wealthy corporations started to reincorporate their US operations as 'runaway headquarters' in tax havens like Bermuda to avoid paying US tax, just as they moved intellectual property such as patents, copyright and the title to the company's logo to such havens. In the large middle of the US tax system, a great amount of redistribution still goes on from the upper middle class and moderately wealthy people, down to those less well off.