Assaf Likhovski, Professor of Law and Legal History at Tel Aviv University, was kind enough to sit down recently to discuss his recent book, Tax Law and Social Norms in Mandatory Palestine and Israel (Cambridge University Press, 2017). In this clip, he gives a short overview of the book and its importance both to the history of tax compliance and to contemporary events. An edited transcription follows.
My book, Tax Law and Social Norms in Mandatory Palestine and Israel, tells the story of what I call the intimate fiscal state. This is a type of state that attempted to use social norms, rather than legal ones, to induce compliance. In my book I show how this type of state rose, and later declined, in one specific location: mandatory Palestine and the state of Israel in the middle decades of the twentieth century. My story is focused on Israel, but I think it actually tells a story which is applicable to other tax jurisdictions in the middle decades of the twentieth century. Now, the story that I tell is obviously of interest to tax historians and to legal historians, but I think it also has some contemporary relevance to people interested in the current global crisis that we are witnessing these very days. A large factor in this crisis is a decline of tax compliance by wealthy individuals and by corporations, for example due to the proliferation of offshore tax havens. This fiscal crisis leads to a political crisis because it undermines the trust that ordinary citizens have in the state and in their fellow taxpayers, and it leads to political movements, such as populist nationalism, that arise out of this crisis. So I think going back to the past and looking at the way in which states in the past have tried to induce compliance is actually relevant to people interested, not in history, but in contemporary politics. Israeli tax compliance is far from perfect, but I think the story of how the Israeli state attempted to induce tax compliance in the mid-twentieth century is actually very relevant even for people interested in the present and not in the past.