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Keywords:

  • fiscal sovereignty;
  • global financial regulation;
  • tax havens;
  • state power

abstract

The global financial crisis (GFC) refocuses attention on the capacity of states to regulate global finance. In this article, I argue that states are augmenting their regulatory capacity by promoting the interpenetration of national economic surveillance systems. I develop this argument by exploring the recent efforts of powerful states to address a particular form of offshore regulatory escape: tax evasion. Previous analyses of offshore processes have been framed by strong assumptions about the geographic domains of states and markets. I present a new analytic framework that weakens these geographic assumptions and explains why some states are more able than others to address offshore tax evasion through unilateral, bilateral, and multilateral channels. The framework is applied to explain the mechanisms through which powerful states have reclaimed evaded taxes and forced global transparency standards on tax havens after the GFC. I conclude that the regulatory changes brought about by recent attacks on tax havens constitute an important remapping of the fiscal state. These attacks provide an interesting case study of the ways in which states are augmenting their capacity to regulate a range of cross-border financial flows.