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January 24, 2002

The Honorable Paul O'Neill
Secretary
Department of Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220

Dear Secretary O'Neill:

 I congratulate you for opposing the tax harmonization initiatives being advocated by high-tax nations. The so-called "harmful tax competition" proposal of the Organization for Economic Cooperation and Development (OECD) and the "information exchange" Savings Tax Directive of the European Union (EU) are bad for taxpayers and bad for America.

Nations should be free to determine their own tax and privacy laws, and if this attracts jobs and capital from high-tax jurisdictions, that is the reward for market-based policy. High-tax nations, instead of seeking to punish this success with fiscal protectionism, should learn the lessons of Reaganomics and enact their own tax rate reductions.

I hope that you will continue your battle on behalf of the world's taxpayers. A "global network of tax police" would be a disturbing mix of bad tax policy, bad privacy policy, bad sovereignty policy, and bad trade policy. You are to be applauded for resisting these misguided schemes.

Sincerely,

Henry Bonilla
Member of Congress

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