How is this possible?
Such arrangements are a very pleasant peculiarity for some people in international jobs, such as working for the UN or in many diplomatic roles. Many pay no or little tax. By the nature of their jobs such people are often rootless. If they paid tax then this money would have to be directed at a certain jurisdiction. Working that out could be complex and open to legal challenge.
Make her pay tax
But a London tax expert had little time for this position: "Presumably it's done to attract the staff they need. They tend to live in different countries. I don't see why they don't pay tax. My personal view is that if you're living somewhere, you should contribute. You get the benefit of living in that country, you should contribute to the infrastructure. She' s [Lagarde] taking without giving anything back."
Paying tax is just for the working class?The acknowledgement that Lagarde pays no tax on her salary is something of a sideshow from the travails of Greece and Italy currently. But it does suggest paying tax is for ordinary wage slaves - or 'little people'. If Lagarde thinks paying tax is important - and there is plenty of evidence to suggest she does - why doesn't she pay any herself?
Working for the UN and other organisations brings other benefits - subsidised travel and rent expenses, for example.
One possible route to addressing this issue - surely you should contribute to the running costs of some jurisdiction somewhere? - in future could be to tax people where they have their main residence.
Media boss of the European Commission, Mark English, told AOL Money that all staff - including bosses - working for the EU do pay tax on their salaries. Which is the bottom line for most people wherever they live. Most people will likely think Lagarde's position is disgraceful.