Tax Havens- All about laundering Black Money.

Politicians form a class of their own.

Through out the world they are united in stashing laundering money along with crooked businessmen.

Unless ordinary Joe revolts this can not be stopped.

Tax Haven, Investment Haven, Asset Protection Haven.  What does it mean?

Exactly what is meant by the term ‘tax haven’? A Tax Haven is geographical area (nation, city, state, or zone, usually known by the term, “jurisdiction“) that levies a lower rate of taxation than average when compared to other nations and jurisdictions. Some jurisdictions levy no taxes at all, and most levy no tax on ‘foreign earned income’, meaning income that is earned outside of their jurisdiction.

To attain privacy [anonymity] as well as to attain a local ‘presence’ the most common practice is to use a paper interface by creating a corporation or IBC (International Business Corporation) in that jurisdiction. By forming a corporation in such a jurisdiction, we become liable to pay that jurisdiction the taxes levied against that corporation on profits earned by the corporation. If there are no taxes levied, then we operate our company at a distinct advantage to companies who must pay 30% – 40% rates of taxation.  Many individuals also move a large portion of their existing assets to a tax haven jurisdiction. It should go without saying that in setting up offshore it is essential to do things correctly. There are qualified offshore advisors which can provide legally correct financial structures for those thinking of moving offshore.

Once our business and/or our assets are offshore, they can be so structured as to take good advantage of beneficial tax savings. They can also enjoy a greater degree of protection from monetary predators.  Anonymity is an important attribute of being offshore; not all jurisdiction provide total protection to their clients anonymity.

Here are the rough overall criteria which more or less describe the basic advantages of a tax haven: Some existing level of freedom from taxation Banking, Corporation, & Transaction secrecy laws that protect both privacy and assets. An absence of exchange controls and other governmental handicaps to doing business The No-tax Tax Haven Tax Havens fall into different categories. The simplest being the No-tax tax haven.  A no-tax tax haven is a country (or jurisdiction) that has no income, capital gain, or wealth taxes of any sort and in which there are facilities and legislation under which we can incorporate and/or form corporations, foundations, and trusts. This type of tax haven is a pure tax haven. The countries that fulfill this definition include; Anguilla, the Bahamas, Bahrain, Bermuda, the Cayman Islands, Cook Islands, Djibouti, Turks and Caicos, Vanuatu and perhaps a few more which we will discuss in subsequent articles. The governments of these countries most usually earn their revenue by charging fees on: documents of incorporation, the value of corporation shares, registration fees, and so forth.  We can operate a business from one of these countries without any income taxes on the money earned by our corporation; or by investments made into the stock market, banks, or the holding of income producing assets such as real estate or precious metals. There are some special considerations which must be observed, but for all intents and purposes the money we earn using a no-tax tax haven as our business base are tax-free. It is not necessary to live in one of these jurisdictions to make use of their beneficial tax structure. It is possible to live in one jurisdiction and have one’s corporate structure in another. In fact it may be preferable to separate corporate jurisdiction, business jurisdiction and resident jurisdiction.  A fuller explanation of this will be explained in a subsequent article. In the use of more than one jurisdiction it is probably prudent to maintain an office presence in a jurisdiction where one does not earn an income. Foreign Source Income Is Tax Free The No-tax-on-foreign-source-income Tax Havens Next, in degree of taxation levied, we have the No-tax-on-foreign-income tax-havens.  These countries (jurisdictions) do impose income taxes, both on individuals and corporations, but only on locally derived income. The countries that fulfill that definition include; Hong Kong, Liberia, Panama, Philippines, Venezuela, Shannon International Airport, Jersey, Belize, Guernsey, Isle of Man, Gibraltar, and a few others whose rules and regulations regarding income will be discussed in subsequent articles. The Low Taxation Tax Havens Some countries establish fixed rates of taxation.  These countries are called Low taxation tax-havens.  They generally tax a small amount on corporate income and have double-taxation agreements with many high-tax countries that when taken in combination and structured correctly work to reduce the overall degree of taxation. This is best for individuals who are not going to become permanent expatriates, but may some day want to return to their home country. The countries which more or less fulfill the Low Tax definition are Cyprus, the British Virgin Islands, Liechtenstein, Oman, Switzerland, Jersey, Guernsey, and other countries which we will be discussing in subsequent articles. Other Categories Then there are the special incentive privileges to off-shore companies and qualified holding companies that are given by tax havens such as Luxembourg, the Netherlands, the Netherlands Antilles, and Singapore.  Plus the international business company tax reductions given by Antigua, Barbados, Grenada, Belize and Jamaica. Which Tax Haven Is Right For You? Count Your Cards While the categories of Tax Havens give us a general indication of their types of taxation, the level of taxation is not a pure indication of their worth to us.  Panama has become one of the more popular Tax Havens because of its ease of entry, its use of the US Dollar, and its excellent banking system. However for the most part one cannot hold any currency in a Panamanian bank other than the US Dollar. There is one bank that does allow EURO accounts but they are not sophisticated in the handling of EURO accounts.  One cannot hold gold or other precious metals in a Panamanian bank. Banking secrecy is said to be guaranteed by the government of Panama, however there is also a guarantee that one cannot be extradited from Panama yet several people have recently been extradited from Panama under circumstances that were less than forthright. Big Brother Is Watching You While Panama still remains the haven of choice for the average person seeking to move offshore be aware that anyone using a US passport to open a bank account in Panama will have that fact reported to the US government. This has become true in many jurisdictions, and some jurisdictions will now no longer accept clients who hold US passports.  The US government is placing a great deal of pressure on offshore jurisdictions, and offshore banks that have correspondent banks inside the USA must comply with US government requirements or face the consequences.  There are still some nations that only require a residency card to open an account, and if one has residency in those nations one can open an account and maintain anonymity. Real Estate / Second Passports The purchase of offshore real estate remains the best placement for funds we wish to expatriate. However most of us cannot put all of our money into real estate, nor do we wish to. There are a number of shell game paper interface tricks that are used to hide the true owner of an IBC or Foundation, but the day of judgment arrives when we have to open a bank account, because as the signer on that account we have to present our passport. The only solution in these matters is to get a second passport. Fake Passports vs Real Passports We know of two South American nations where one can get an under the table passport. These passports are registered in the system, one can travel on them and for all intents and purposes they are real passports.  Your best hope with one of these passports is that you end up in a US prison and not a South American prison, because prison conditions in South America are horrendous.  Our advice; don’t even think of using a fake passport; life isn’t a James Bond movie, and you aren’t Double O Seven. The Dominica Passport is only $75,000 – if that fee is too much for you than go ahead and open an offshore bank account with your US passport because you don’t have enough money to set off any alarm bells in any case. Help! Where Can I Stash My Assets? Recommendations If you are not sophisticated in the world of offshore, and you feel like the fincancial crisis is about to collapse your finances we would recommend the Sovereign Society, which is a worldwide group of investment & privacy advisors that teamed up to provide safe advice about moving offshore, choosing the safest tax havens, best banks, and the most secure devices in which to protect your assets.  They have years of experience and a very good track record. We have some articles written by Sovereign Society members Move Overseas You only face consequence if you live in the USA, if you are moving offshore your concerns shouldn’t be too great. The US government is not going to expend the time and effort to track down everyone moving abroad because millions are doing so and most of their assets are not repatriable.  How are they going to confiscate your ranch in Argentina and move it back to the US? Bank in Austria Banking in Austria is considered safe for US passport holders, but they won’t take clients living in the USA. If you are a US passport holder living outside the USA an Austrian bank would be a preferred place to put your assets. Read our report on how to bank in Austria Quick Residency Two nations that are quick to provide residency are Belize and the Dominican Republic; in the Dominican Republic one can open a bank account with a residency card.  John Schroder has a program in the Dominican Republic; contact him about obtaining residency in the Dominican Republic – Offshore Service Providers Offshore service providers can find solutions. We are building up a list of offshore service providers whose services we can ascertain to be honest and reliable. Until we have that list in place please be circumspect in dealing with offshore service providers. Mention what you have read on this page, if they say that yes, that is true, however I can find solutions to these problems, then proceed with caution. If, on the other hand they say that what is written here is hyperbole, totally false, and that we don’t know what we’re talking about, then head for the door and find another offshore service provider. The defining characteristic of offshore investing is that much of it is uncontrolled, or loosely controlled by any government regulations. While that is its positive characteristic, it also why it is a sector full of crooks and flimflam artists. Caveat Emptor. Please proceed with caution. Offshore Banks We have a list of offshore banks. In most cases an offshore service provider is not required to open a bank account. Seek out a bank and make an inquiry. Find out their policy and ask about opening an account. If you wish to make investments via the bank you will have to ask if they provide investment services, do they hold precious metals, can you hold deposits in multiple currencies.  If you are a US passport holder be sure to ask what their policy is for US passport holders. If you reside in the USA keep in mind that the US government monitors all mail leaving the United States addressed to certain jurisdictions. Using A Tax Haven By opening a corporation in an offshore jurisdiction, the businessman and/or investor can recognize substantial tax savings as well as protection from frivolous lawsuit.  The structuring of such a program must be done correctly. Opening an offshore corporation is not difficult. In some cases it may be necessary to have an offshore office so that the offshore presence is actual rather than purely virtual, in other cases it is not necessary; this depends on the nature of the enterprise.  If we want to protect our savings and keep our assets in an offshore bank then an office is not necessary, if we are running a business we may want to have an office in that jurisdiction, either in the form of actual office, or as a virtual office where we receive mail, fax, and have an answering service for phone calls.  Today with Skype and other VoIP telephones it is easy to establish a virtual phone number in any number of jurisdiction which ring in other jurisdictions. Creating A Virtual Presence We can now have a US dial tone almost anywhere in the world …and call to anywhere in the world – in many cases toll free -  Those of us who have lived overseas for decades have been witness to an amazing evolution in the ability to make international telephone calls.  In the book version of Escape From America, a telephone system called Call Back was recommended; which at that time was a state of the art modality in the ability to make international phone calls.  Most people had never heard of it. Today Call Back is old hat.  Every few years the technology of what is called ‘telephony’ (teh-LEH-fuh-nee) makes even greater strides.  Today we have OOMA, Vonage, Skype, and a dozen other stystems each of which use VoIP, (Voice-over-Internet protocol)  a protocol optimized for the transmission of voice through the Internet or other packet-switched networks. There is a reason why each of the three systems mentioned are excellent services and which is superior depends very much on what it is we intend to use our overseas telephone for. As of this writing OOMA is the latest, and perhaps the greatest; it gives us a US telephone number that provides free calling to any US number, and low cost international calls. However OOMA doesn’t give you a virtual telephone number in London, or in other parts of the world, Vonage does.  With Skype you get can get up to ten numbers in a very wide choice of jurisdictions. Note, for the purposes of this article, that a Skype number can be forwarded into another phone. Skype is great on a laptop, especially now that you can hook in a USB port telephone and carry it with you when you travel.  The hardware is where the innovations have occurred.  We have made a list of the phones that we recommend. Click here to see them all – each of the phones listed explains its features and its cost. If your desire is to create a virtual presence in a jurisdiction or to achieve anonymity this is the best way to do so. There is also a way to forward a phone number located in any jurisdiction into a VoIP number by using PBX software which we will be discussing in a subsequent article. Also note that if you intend to live overseas you will want one of these phones if for that reason alone. You Can’t Bug Me Note: We have been told that VoIP phones are extremely difficult to bug. This, we are told, is because they use a digital signal and it is difficult to read, much as a fax line is difficult to read. Such signals can be read by someone intent on bugging a phone, but only with great difficulty and at great expense.  Due to the proliferation of VoIP phones in use the chances of a VoIP phone being bugged are extremly remote. http://www.escapeartist.com/Special_Reports/What_Is_A_Tax_Haven/   Related: Many large U.S. companies use offshore subsidiaries and creative tax planning to lower their tax rates at the expense of the rest of us. As taxpayers and legislators wring their hands over missing budget funds, it is eye-popping to see where much of the money has gone. The list of players using offshore tax havens to shift profits overseas reads like a Who’s Who among big businesses and banks. For starters, there’s Google, which has paid a tax rate of 2.4 percent since 2007 on its profits. Then there’s Goldman Sachs, which in the same year received a $10 billion taxpayer bailout and paid just a 1 percent effective tax rate on their profits. The “Big Four” audit firms, such as Ernst & Young, not only advise clients on tax haven strategies, but use them to also ship their own profits overseas. Most recent exposés give a frightening peek into the aggressive tax maneuvering of companies such as General Electric, Carnival, Boeing, Yahoo and Southwest Airlines. Official estimates by the federal GAOshow at least 83 percent of the largest 100 companies have created offshore subsidiaries in places like the Cayman Islands that are officially listed as tax havens. Offshore tax havens cost the Treasury over $100 billion per year. It’s the equivalent of a massive annual bailout for America’s largest, and often times, least scrupulous corporations. We should never have tolerated it and can no longer afford it. Rampant tax avoidance by corporations is not even good for business. Capitalism works best when companies thrive based on their efficiency and capacity to innovate; not based on the number and aggressiveness of their tax lawyers. Curiously, some of the most vocal defenders of tax havens seem to forget about the lost revenue while issuing strong warnings about the size of our deficit. For instance, John Castellani, president of the Roundtable, a vocal critic of large deficits calls closing tax haven loopholes, “the wrong idea at the wrong time for the wrong reasons.” For those who oppose reform, the shifting of tax burdens onto already struggling taxpayers and small businesses doesn’t even seem to deserve a shoulder shrug. http://www.huffingtonpost.com/phineas-baxandall/iin-the-public-interesti_b_823717.html