7th November 2016
The UK’s Shadow Home Secretary, Dianne Abbott, called Jersey out in a recent House of Commons speech, claiming that the Crown Dependency is part of the ‘largest tax-evasion network in the world’. This latest location to be named adds to the already extensive list of areas allegedly being utilised as a tax haven.
So what other countries have made the unsavoury list of tax havens?
This small European country has several business-friendly laws that international companies are making the most of to reduce their tax payments. Amazon is one such firm that has set up headquarters in the area in order to funnel sales through this office and reduce their tax payments. However, given the on-going scrutiny of this approach, it will surely only be a matter of time before this is addressed by local authorities.
Isle of Man
The Isle of Man is well-known for its lack of capital gains tax, inheritance tax, corporation tax or stamp duty, making it an attractive place for those looking avoid paying higher taxes.
International corporations – particularly US based ones – have long used Irish subsidiaries to dodge appropriate tax payments, with tech giant Apple being just one of the recent firms facing scrutiny for such an approach. In fact, over a quarter of Fortune 500 companies had such subsidiaries in the country in 2014. However, given that Irish officials are so keen to change the view of the country as a tax haven, it can be safely assumed that these tax dodgers will soon face challenges from local authorities.
This small island in the Indian Ocean has become a popular place for mega-corporations to set up subsidiaries, with the likes of JP Morgan Chase, Citigroup and Pepsi maximising on the country’s tax breaks. However, as the global clampdown on tax evaders continues, it’s surely only a matter of time before this is addressed.
An historical tax haven, many businesses turn to the country to make the most of its low taxation, including Google which allegedly avoids as much as $2 billion a year in taxes through its connection with this location.
While this list demonstrates that there are several countries which have become popular tax havens, the commitment from global authorities to clampdown on tax evasion schemes such as these means it is simply a matter of time before there is absolutely nowhere for anyone to hide. For contractors operating around the globe, incorrect tax payments could be hugely detrimental to your finances, so it’s always advisable to consult with a team of experts to ensure you remain compliant in your chosen location.
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