Share this infographic on your site!

Tax Havens of the Wealthy and Powerful

Embed this infographic on your site!


The editors at Online Accounting Degrees decided to research the topic of:

Tax Havens of the Wealthy and Powerful

More and more companies are stashing their cash offshore, and they're doing it at alarming rates. Why? Put simply, it's about eluding the tax man.


- $21 trillion =
- US, Japanese, and German economies combined.
- EU, Russian, and Indian economies combined.
- Total private wealth held in tax havens worldwide.

- $9.8 trillion =
- Private wealth held in tax havens by a mere 100,000 people.
- The amount of foreign aid the US would provide in 196 years at current rates.

"Double Irish with a Dutch Sandwich"


- Profits routed through Irish and Dutch subsidiaries often end up in Caribbean shell corporations that don't pay US taxes.
- 83 of the 100 largest companies in the US with subsidiaries in tax havens.

Largest Major Corporate Investors

[corporation-unrepatriated income (in millions)]


- General Electric--$108,000
- Pfizer--$73,000
- Microsoft--$60,800
- Apple--$54,300
- Exxon Mobile--$47,000
- Merck--$53,400
- Johnson and Johnson--$49,000

Fastest Movers

[corporation-percentage increase in offshore investment 2009-11]


- Spectra Energy--%1141.8+
- Broadcom--%775.5+
- Visa--%588.4+
- Sandisk--%546.4+
- Ford Motor--%546+
- Home Depot--%426.3+
- Apple--%212+
- FedEx--%207.7+
- Starwood Hotels--%203+
- Unum Group--%197.6+
- Amazon--%119.3+
- Genworth Financial - %108.5+

Bailed out and bailing ship

Citigroup, Goldman Sachs, and Morgan Stanley were some of the larger bailouts of the 2008 financial crisis.

[corporation-amount received in bailout money-amount shipped offshore since-percentage increase since financial crisis]


- Citigroup--$2,500 billion--$35.9 billion--%32+
- Goldman Sachs--$10 billion--$20,630 million--%27+
- Morgan Stanley--$107 billion--$6,461 million--%61.5+

[Public Opinion]


- %73 of Americans feel that loopholes should be closed allowing corporations and the wealthy to avoid US taxes by shifting income overseas.
- %83 of Americans feel that tax on US corporation's overseas profits should be increased to equal what their US income tax would be.
- %90 of Small business owners believe that large corporations use loopholes to avoid taxes that smaller businesses have to pay.

[Tax Burden ]

Estimated Federal Income tax losses from tax havens = $150 billion per year


- US corporate untaxed wealth in tax havens= $90 billion
- US individual untaxed wealth in tax havens= $60 billion
- $150 billion = $1026 in additional taxes from every tax filer in the US.
- $150 billion = %6 percent of total reportable income for the US not filed correctly.

Havens

In 2007, tax havens accounted for nearly 9% of the world's gross assets and liabilities. Meanwhile these nations accounted for only .2 percent of the world's population and .25 percent of the world's GDP.

[nation title; total portfolio investment (in millions, 2010 data); population 2010] [0= <1 mil]


- Andorra: 217 ; 83,888
- Anguilla: 627 ; 14,764
- Antigua and Barbuda:132 ; 82,000
- Aruba: 1874 ;101484
- Bahamas:17,101 ; 353,658
- Bahrain:11719 ; 1,234,571
- Barbados 2584 ; 276,300
- Belize: 340 ; 312,971
- Bermuda: 402,093 ; 64,237
- British Virgin Islands: 58,888 ; 106,405
- Cayman Islands: 1575332 ; 54,878
- Cook Islands:7 ; 21,390
- Costa Rica: 397 ; 4,563,539
- Cyprus: 18599 ; 1,102,677
- Djibouti: 3 ; 879,053
- Dominica: 1 ; 65,000
- Gibraltar: 3035 ; 28,956
- Grenada: 60 ; 109,553
- Guernsey: 82547 ; 44547
- Hong Kong: ; 7,024,200
- Ireland: 1090520 ; 4,467,854
- Isle of Man: 10394 ; 12,869
- Jersey: 232812 ; 95,732
- Jordan: 2260 ; 6,113,000
- Lebanon: 2670 ; 3,785,655
- Liberia: 7607 ; 4,101,767
- Liechtenstein: 5529 ; 35,789
- Luxembourg: 2051813 ; 502,066
- Macao: ; 552,300
- Maldives: 3 ; 319,738
- Malta: 3389 ; 414,372
- Marshall Islands:12082; 54816
- Mauritius: 12448 ; 1,283,415
- Micronesia: 0 ; 176,815
- Monaco: 80 ; 36,371
- Montserrat: no data ; 5,000
- Nauru: ; 13,000
- Netherlands: 1883690 ; 16,574,989
- Antilles: ; 197,041
- Niue: 0 ; 1496
- Panama:33587 ; 3,504,483
- Samoa: 4 ; 183,123
- San Marino: 84 ; 13,147
- Seychelles: 170 ; 86,525
- Singapore: 173271 ; 5,076,700
- St. Kitts and Nevis: 286 ; 51,300
- St. Lucia: 112 ; 174,000
- St. Martin: ; 77,741
- St. Vincent and the Grenadines:278 ; 125,000
- Switzerland: 712,622 ; 7,785,806
- Tonga: no data ; 103,365
- Turks and Caicos Islands: 902 ; 50,000
- Vanuatu: no data ; 245,036

Shell Games


- Establishing a corporation offshore:
- Three pieces of paper:
- A nominal director declaration states that the nominal director with a tax haven address will follow the direction of the firm's real owner.
- An undated resignation letter allows the nominal director to duck liability.
- Power of attorney is granted to the corporation's real owner.
- The Ugland House, one small building in the Cayman Islands is home to some 18,857 companies.
- The state of Delaware, with a population of 917,092, is home to some 945,000 companies, many of which are shells.

So you have a nominal owner, what happens then?


- Like Bidzina Ivanishvili, the Prime Minister of Georgia, you can buy Picasso's "Dora Maar au Chat" for $95 Million, a full $35 million more than it is appraised for. Just because you want to.
- Also like Ivanishvili, you can provide 60,000 in your home region with free electricity and gas, build twenty schools, a stadium, and provide monthly bonuses to doctors and teachers.
- At $2 million for a 65' yacht, the global private wealth in tax havens could fill the entire length of the Mississippi River 34.8 times.

Citations


- http://www.prospectmagazine.co.uk/magazine/bidzina-ivanishvili-georgia-billionaire-philanthropist/
- http://www.economist.com/news/leaders/21571873-how-stop-companies-and-people-dodging-tax-delaware-well-grand-cayman-missing-20
- http://www.scribd.com/fullscreen/134015001?access_key=key-7wqo6wfka6mmlv2g5zo
- http://www.icij.org/offshore/how-nominee-trick-done
- http://www.icij.org/offshore/sarah-petre-mears-queen-nevis
- http://www.icij.org/offshore/mega-rich-use-tax-havens-buy-and-sell-masterpieces
- http://thelede.blogs.nytimes.com/2013/04/04/making-sense-of-trillions-in-offshore-dollars/?ref=offshorebanking
- http://www.taxjustice.net/cms/upload/pdf/The_Price_of_Offshore_Revisited_Presser_120722.pdf
- http://www.ibtimes.com/ge-pfizer-microsoft-apple-other-major-us-corporations-are-parking-more-cash-abroad-avoid-paying
- http://www.gfintegrity.org/storage/gfip/images/gfi%20-%20us%20assets%20in%20tax%20havens.jpg
- http://www.imf.org/external/pubs/ft/wp/2010/wp1038.pdf
- http://ctj.org/pdf/unrepatriatedprofits.pdf
- CIA Factbook
- MacroAxis
- "Treasure Islands" Journal of Economic Perspectives, James R. Hines Jr.
- Citizens for Tax Justice


social