Monday, June 1, 2020

World’s Most Secret Tax Hideaways Revealed

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Expats can see how the country where they live or invest ranks on a new global financial secrecy index.

The index rates countries according to the financial secrecy laws and level of offshore financial activity.

The Tax Justice Network, an independent lobby group of journalists and financial analysts has compiled the index.

The group estimates between £13.5 trillion and £21 trillion of personal wealth is stashed in countries that throw a veil of secrecy over the personal financial affairs of individuals, while African potentates are accused of hoarding the wealth of their countries while leaving the poorest citizens to pay off the debt.

“Rich countries can suffer the same fate,” said a spokesman. “The people of Greece, Portugal and Italy have shouldered the burden of austerity that has followed decades of tax evasion and state looting hiding assets overseas.”

Countries that keep financial secrets

The index reveals the top 15 countries for tax avoidance as:

  • Switzerland
  • Hong Kong
  • USA
  • Singapore
  • Cayman Islands
  • Luxembourg
  • Lebanon
  • Germany
  • Bahrain
  • United Arab Emirates (Dubai)
  • Macao
  • Japan
  • Panama
  • Marshall Islands
  • United Kingdom

The report also argues that if the UK and the British Overseas territory of The Cayman Islands were combined, they would top the table.

Drawing conclusions from the data

“One of the conclusions to draw is some of the nations at the forefront of fighting tax evasion are also those with more financial secrecy and offshore activity than those they are trying to legislate against,” said a Tax Justice Network spokesman.

The States is forcing financial institutions around the world to supply personal and financial data about accounts and assets controlled by US taxpayers with the Foreign Account Tax Compliance Act (FATCA).

Britain is at the forefront of a European and Organisation of Economic Cooperation and Development (OECD) effort to trigger a son-of-FATCA network between more than 100 countries worldwide automatically exchanging financial data about taxpayers.

Britain and the Cayman Islands are also the base for a third of the 177,000 financial institutions registered with the US Internal Revenue Service (IRS) under FATCA rules.

The Financial Secrecy Index covers 102 financial jurisdictions.

The Tax Justice Network has published the listing for the first time, but intends to revisit the data every year to monitor improvements or declines in offshore tax avoidance.

The full Financial Secrecy Index can be read here

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