Home Uncategorised The world’s top five tax havens – not including Panama

The world’s top five tax havens – not including Panama

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The world’s top five tax havens – not including Panama

USA

It may come as a surprise that the world’s biggest power is on the list, given its President’s strong stance against tax avoidance. However, its federal system allows states to make their own laws on certain subjects – and one of these is financial regulation.

Delaware, just a stone’s throw from the White House on the East Coast of America, has 945,000 firms registered within it – almost one for each resident. It is one of four states, which also include Nevada, Arizona and Wyoming, that house “ghost companies” – there to take advantage of their weak financial laws. Transparency International, an anti-corruption campaigning movement, has recently described Delaware as a “transnational crime haven”.

delaware

Jersey

Jersey, a small island of the coast of the UK, prints its own banknotes and makes its own tax laws – allowing it to have a certain amount of secrecy and discretion that has been widely taken advantage of by those looking to avoid tax. It is estimated that Jersey houses an estimated 5 billion dollars of wealth per square mile.

jersey

British overseas territories

President Obama recently pointed out that Ugland House, a business building in the Cayman Islands, is registered as holding 12,000 companies. He eloquently made the added, “that’s either the biggest building or the biggest tax scam on record.” According ot the Tax Justice Network, the Cayman Islands have more registered companies than people living there, with around $2 trillion in banking assets.

The Cayman Islands are self-governing, but are a British Overseas Territory – alongside another key haven, the British Virgin Islands, which features strongly in the Panama Papers. These islands, with their link to the UK, have been the first port of call for many British individuals or corporations looking to avoid tax – those registered there pay no income tax, capital gains tax, company tax, or inheritance tax. Tight security laws also protect companies from being forced to reveal details of the finances based there.

shutterstock_307062515Switzerland

Another oldie but a goodie – Swiss bank accounts have been a favoured tax avoidance tactic for years. Even Hitler knew this trick – it was only as recently as the 1990s that bankers released gold stored by the Nazi government during the Second World War.

Since they’re not in the EU, their lax laws are even harder to regulate. Undoubtedly, Switzerland is at the top of this list – innumerable wealthy people and companies have money hidden here.

switzerland

Hong Kong

Another ex-British colony, Hong Kong’s laissez-faire approach to the economy makes it an ideal tax haven. An ‘ask no questions, tell no lies’ approach is employed here, and it is favoured by wealthy individuals and companies from China.

In the Tax Justice Network’s report, Hong Kong obtained a secrecy score of 71 – placing it at the higher end of the secrecy scale, roughly on a par with Panama, and even higher than all of the major British-linked secrecy jurisdictions. Its offshore services including tax exemptions, transfer pricing facilities, escape routes from Chinese exchange controls, and various forms of financial secrecy including the use of opaque companies and trusts that can assist tax evasion and other crimes.

hong kong

12/04/2016