Bono, tax avoider.

Gossip, speculation, and scuttlebutt about politics.
Oct. 31 2006 6:43 PM

Bono, Tax Avoider

The hypocrisy of U2.

Bono. Click image to expand.
Bono

A familiar paradox about leftist celebrities in the entertainment industry is that their embrace of progressivism almost never includes a wholehearted embrace of progressive taxation, i.e., the principle that the richer you get, the larger the percentage of your income you ought to pay in taxes. The latest example is U2's Bono, a committed and unusually sophisticated anti-poverty crusader who is taking surprisingly little heat for the decision by his band, U2, to relocate its music-publishing business from Ireland to the Netherlands in order to shelter its songwriting royalties from taxation.

The irony was stated in admirably stark terms by Bloomberg's Fergal O'Brien, who reported on Oct. 16:

Bono, the rock star and campaigner against Third World debt, is asking the Irish government to contribute more to Africa. At the same time, he's reducing tax payments that could help fund that aid.

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"Preventing the poorest of the poor from selling their products while we sing the virtues of the free market … that's a justice issue," Bono said at a prayer breakfast attended by President Bush, Jordan's King Abdullah, and various members of Congress earlier this year. Preaching this sort of thing has made Bono a perennial candidate for the Nobel Peace Prize. He continued:

Holding children to ransom for the debts of their grandparents ... that's a justice issue. Withholding life-saving medicines out of deference to the Office of Patents ... that's a justice issue.

And relocating your business offshore in order to avoid paying taxes to the Republic of Ireland, where poverty is higher than in almost any other developed nation? Bono's hypocrisy seems even more naked when you consider that Ireland is a tax haven for artists. In June 2005, Bono (who was born in Dublin) told the Belfast Telegraph:

Our publishing, which is about one third of our income, we have tax breaks on, and that's great and that's encouraged us to stay in Ireland and if that changes, it's not going to affect anything for U2. ...

Six months later, Ireland's finance minister announced a ceiling of $319,000 on tax-free incomes, and six months after that, U2 opened its Amsterdam office. The relocation of U2's music publishing will halve taxes on the band's songwriting royalties, which already reportedly total $286 million. Although Bono has declined to comment on the move, the band's lead guitarist, David "the Edge" Evans, said, "Of course we're trying to be tax-efficient. Who doesn't want to be tax-efficient?'" Writing in the Observer, Nick Cohen noted that Evans "sounded as edgy as a plump accountant in the 19th hole."

U2's tax-shelter scheme caused an uproar in Ireland when the story broke there in August. But it's scarcely raised a ripple in the United States. A conservative would argue that's because in this country, we don't begrudge a man the opportunity to keep what he earns off the sweat of his brow (or even off the sweat of someone else's brow) … even if that man spends half his time trying to goad governments into spending more to alleviate poverty. But a liberal could answer that in the United States, we are so used to seeing rich people avoid taxation that even a wealthy hypocrite who shelters his cash abroad can no longer qualify as news.

Timothy Noah is a former Slate staffer. His  book about income inequality is The Great Divergence.

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