New Report: The US is World’s 2nd Biggest Tax Haven, Surpassing Cayman Islands

The United States is the world’s second-largest tax haven, behind Switzerland and just ahead of the Cayman Islands, according to a new report published Tuesday by the Tax Justice Network. The Financial Secrecy Index (FSI), an assessment of global financial centers compiled once every 2 years, bumped the U.S. up from its No. 3 spot in the previous report, released November 2015.

The U.S. now accounts for 22 percent of the world’s offshore services, up from 14 percent.

The report’s authors criticized the U.S. for its “independent-minded approach” to cracking down on tax evasion, money laundering, and financial crime. Because the U.S. does not comply with Organization for Economic Cooperation and Development (OECD)‘s common reporting standards, money held in U.S. banks and institutions will not automatically need to be reported to the account holder’s tax authorities, as it would if it were in one of the 100+ countries that have agreed thus far to automatically exchange tax-relevant account information.

“Financial secrecy provided by the U.S. has caused untold harm to the ordinary citizens of foreign countries, whose elites have used the United States as a bolt-hole for looted wealth.” (FSI)

Delaware, Nevada, and Wyoming were highlighted as hot spots for secretive “shell” companies, with nominee officers and directors serving as a front for the actual, hidden owners. “1209 North Orange Street, Wilmington, DE, 19801” is the legal address for no fewer than 285,000 separate businesses.

The unremarkable single-story building’s occupants, on paper, include corporate giants such as  American AirlinesAppleBank of AmericaBerkshire Hathaway, CargillCoca-ColaFordGeneral ElectricGoogleJPMorgan Chase, and Wal-Mart. These companies do business across the nation and around the world. But at 1209 North Orange, they simply have a dropbox.

Hong Kong ranks as the fourth most secretive financial jurisdiction, followed by Singapore at No. 5. Taiwan was included for the first time, ranked at No. 8.

The index ranks countries on their laws regarding the transparency of ownership structures, bank secrecy rules and financial reporting and disclosure requirements. Scores are weighted for size. This year, it used new criteria including whether countries provide public registers of ownership and annual accounts for limited partnerships.

TJN has partnered with Transparency International and the Financial Accountability and Corporate Transparency (FACT) Coalition for the U.S. launch of the 2018 FSI at an event in Washington, D.C. Tuesday afternoon.


[whohit]us-now-worlds-2nd-largest-tax-haven[/whohit]

 

Be the first to comment

Leave a comment: