There has been further evidence in recent weeks of just how well offshore and low-tax financial centers are performing amid economic insecurity and regulatory change. Recently, we learned that the number of active companies registered in the Cayman Islands surpassed 100,000 earlier this year; that the Isle of Man’s e-gaming sector is going from strength to strength; that members of the Association of Bermuda Insurers and Reinsurers reported a strong 2015; and that the British Virgin Islands is of the belief that it is on the cusp of becoming the best-regulated financial services jurisdiction in the world.
Of this list, the last one in particular stands out. For it was the BVI that was found to be home to many of the corporate entities set up for those exposed in the Panama Papers, and the jurisdiction was consequently excoriated by the world’s … Read More »
There is a theory, usually expounded by free marketeers, that governments, and societies at large, benefit from tax cuts because: taxpayers are less inclined to find ways to avoid tax and therefore the government collects more revenue; more revenue for the government means more can be spent on public services; and a lower tax burden means people have more disposable income to spend, and businesses have more money to invest. In other words, everyone’s a winner!
But has the theory been tested in the real world? I suppose you could say that it holds true to some extent. Look at the countries that enjoyed stellar rates of economic growth prior to the last financial crisis. They tended to be low-tax economies like Singapore, the United Arab Emirates, and Ireland. Many high-tax economies, particularly in Europe, barely registered a blip on the … Read More »
India’s Rajya Sabha, the upper house of parliament, has approved legislation that will, hopefully, pave the way for the introduction of a national goods and services tax system.
It’s not often that a new tax should be so celebrated, but the GST isn’t just a victory for simplification (well, almost at three taxes in one). It’s also being seen as a major triumph for the BJP Government and its reformist credentials. Certainly, it has taken Narendra Modi’s Government two tortuous years to get to this point, even though it was one of its top priorities. But it has accomplished far more in those two years than the previous administration – whose idea GST was – had achieved in more than 10. However, where India and taxation are concerned, things are rarely straight forward. This isn’t a done deal yet. The Constitutional … Read More »
The European Union has flatly denied that New Zealand will be placed on a new blacklist of tax havens stemming from its probe into the Panama Papers. But no smoke without fire as the saying goes, and the idea must have come from somewhere. Well, as it turns out, that somewhere was a non-legislative resolution proposed by a member of the European Parliament that New Zealand was worthy of investigation because it made an appearance in the documents leaked from Panama law firm Mossack Fonseca. And it seems that New Zealand’s foreign trusts regime has put the country on the radar of the international transparency campaign.
Certainly, if anonymity is top of your list when organizing your financial affairs, you could do a lot worse than make use of a New Zealand foreign trust, which has been one of the most … Read More »
Britannia may no longer rule the waves, but it is still the world’s fifth-largest economy, home to arguably the most important financial center in the world (I’m never quite sure how such things are measured, but it’s right up there with New York), and remains something of a force on the world diplomatic stage. It is therefore unsurprising to see so many countries express an interest in doing trade deals with the UK. And, after a worrying period during which the country appeared to have politically decapitated itself, it is also encouraging to at last see the embryo of a Brexit plan emerge, with the Government now keen to sell Britain to key developed and emerging economies.
A word of warning for the UK though: don’t get your hopes up too soon. Despite the encouraging feedback the UK has had from … Read More »