Analysis of information sources in references of the Wikipedia article "Tax haven" in English language version.
Some experts see no difference between tax havens and OFCs and employ the terms interchangeably.
[In the Whitehouse advocating for the TCJA] Applying Hines and Rice's (1994) findings to a statutory corporate rate reduction of 15 percentage points (from 35 to 20 percent) suggests that reduced profit shifting would result in more than $140 billion of repatriated profit based on 2016 numbers.
Applying Hines and Rice's (1994) findings to a statutory corporate rate reduction of 15 percentage points (from 35 to 20 percent) suggests that reduced profit shifting would result in more than $140 billion of repatriated profit based on 2016 numbers.
Mr Henry said his $21tn is actually a conservative figure and the true scale could be $32tn. A trillion is 1,000 billion. Mr Henry used data from the Bank of International Settlements, International Monetary Fund, World Bank, and national governments.
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance' (Hines, 2008). In this paper, I will use the expression 'tax haven' and 'offshore financial center' interchangeably (the list of tax havens considered by Dharmapala and Hines (2009) is identical to the list of offshore financial centers considered by the Financial Stability Forum (IMF, 2000), barring minor exceptions)
In 2007 to 2009, WPP, United Business Media, Henderson Group, Shire, Informa, Regus, Charter and Brit Insurance all left the UK. By 2015, WPP, UBM, Henderson Group, Informa and Brit Insurance have all returned
a place where people pay less tax than they would pay if they lived in their own country
Concerning the characterization of tax havens, we follow the definition proposed by Hines and Rice (1994) which has been recently used by Dharmapala and Hines (2009).
A tax haven is a country or place which has a low rate of tax so that people choose to live there or register companies there in order to avoid paying higher tax in their own countries.
Table 1. Countries Listed on Various Tax Haven Lists
Yet today it is difficult to distinguish between the activities of tax havens and OFCs.
The 'tax havens' are locations with very low tax rates and other tax attributes designed to appeal to foreign investors.
Tax havens are typically small, well-governed states that impose low or zero tax rates on foreign investors.
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance' (Hines, 2008). In this paper, I will use the expression 'tax haven' and 'offshore financial center' interchangeably (the list of tax havens considered by Dharmapala and Hines (2009) is identical to the list of offshore financial centers considered by the Financial Stability Forum (IMF, 2000), barring minor exceptions)
ABSTRACT: Per capita real GDP in tax haven countries grew at an average annual rate of 3.3 percent between 1982 and 1999, which compares favorably to the world average of 1.4 percent.
Finally, we find that US firms with operations in some tax haven countries have higher federal tax rates on foreign income than other firms. This result suggests that in some cases, tax haven operations may increase US tax collections at the expense of foreign country tax collections.
The four OECD member countries Luxembourg, Ireland, Belgium, and Switzerland, which can also be regarded as tax havens for multinationals because of their special tax regimes.
{{cite journal}}: Cite journal requires |journal= (help)Examples of such tax havens include Ireland and Luxembourg in Europe, Hong Kong and Singapore in Asia, and various Caribbean island nations in the Americas
Members of the European Parliament have voted to include the Netherlands, Ireland, Luxembourg, Malta and Cyprus on the official EU tax haven blacklist.
There is no single definition of a tax haven, although there are a number of commonalities in the various concepts used
Figure D: Tax Haven Literature Review: A Typology
Brussels. 30.8.2016 C(2016) 5605 final. Total Pages (130)
The four OECD member countries Luxembourg, Ireland, Belgium, and Switzerland, which can also be regarded as tax havens for multinationals because of their special tax regimes.
As already noted, one of Luxembourg's key selling points for the world's mobile hot money has long been Luxembourg's role as a state 'captured' by offshore financial services, which has effectively removed the possibility of democratic opposition to the sector.
Based on an analysis of data on tax disputes between tax authorities, the economists say that tax authorities in high-income countries tend to focus on transactions with other high-income countries rather than work on profit shifting trails that end in such island havens as Bermuda.
Alex Cobham of the Tax Justice Network said: It's disheartening to see the OECD fall back into the old pattern of creating 'tax haven' blacklists on the basis of criteria that are so weak as to be near enough meaningless, and then declaring success when the list is empty."
The 17 countries on the European list are American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, the Marshall Islands, Mongolia, Namibia, Palau, Panama, St Lucia, Samoa, Trinidad & Tobago, Tunisia and the UAE
EU members were not screened but Oxfam said that if the criteria were applied to publicly available information the list should feature 35 countries including EU members Ireland, Luxembourg, the Netherlands and Malta
Brussels is challenging the "Double Irish" tax avoidance measure prized by big U.S. tech and pharma groups, putting pressure on Dublin to close it down or face a full-blown investigation. [..] The initial enquiries have signalled that Brussels wants Dublin to call time on the tax gambit, which has helped Ireland become a hub for American tech and pharma giants operating in Europe.
A country with little or no taxation that offers foreign individuals or corporations residency so that they can avoid tax at home.
Appendix Table 2: Tax Havens
{{cite journal}}: Cite journal requires |journal= (help)Although a previous literature has modelled tax havens as a benign phenomenon that helps high-tax countries reduce the negative impact of their own suboptimal domestic tax policies, there is considerable concern that the havens are "parasitic" on the tax revenues of the non-haven countries
Table 1: Jurisdictions Listed as Tax Havens or Financial Privacy Jurisdictions and the Sources of Those Jurisdictions
So, if you think about a lot of technology companies that are housed in Ireland and have massive operations there, they're not going to maybe need those in the same way, and those can be relocated back to the U.S.
The OECD is clearly ill-equipped to deal with tax havens, not least as many of its members, including the UK, Switzerland, Ireland and the Benelux countries are themselves considered tax havens
One of the criteria, for example, is that a country must be at least "largely compliant" with the Exchange Of Information on Request standard, a bilateral country-to-country information exchange. According to Turner, this standard is outdated and has been proven to not really work.
Ireland does not meet any of the OECD criteria for being a tax haven but because of its 12.5 per cent corporation tax rate and the open nature of the Irish economy, Ireland has on a few occasions been labeled a tax haven.
The eight major pass-through economies—the Netherlands, Luxembourg, Hong Kong SAR, the British Virgin Islands, Bermuda, the Cayman Islands, Ireland, and Singapore—host more than 85 percent of the world's investment in special purpose entities, which are often set up for tax reasons.
IMF Working Paper 07/87
{{cite journal}}: Cite journal requires |journal= (help)ANDREA KELLY (PwC Ireland): "We expect most Irish QIAIFs to be structured as ICAVs from now on and given that ICAVs are superior tax management vehicles to the Cayman Island SPCs, Ireland should attract substantial re-domiciling business
It was certainly an improvement on the list recently published by the Organisation for Economic Co-operation and Development, which featured only one name – Trinidad & Tobago – but campaigners believe the European Union has much more to do if it is to prove it is serious about addressing tax havens.
New Gabriel Zucman study claims State shelters more multinational profits than the entire Caribbean
The Republic helps big multinationals to engage in aggressive tax planning and the European Commission should regard it as one of five "EU tax havens" until substantial tax reforms are implemented.
Study claims State shelters more multinational profits than the entire Caribbean
One recent report said that the bulk of the foreign direct investment here was "phantom" and driven by tax avoidance. Another said that we are one of the world's biggest tax havens. [..] More leprechaun economics at work?
[..] "the captured state": a world in which policymaking has been largely taken over by financial interests that can pick and choose between jurisdictions and in effect write the laws they need. "That happens in its purest form in the very small tax havens where there is just no local democracy to do anything.
Chapter 21. Troubling tax havens: Tax footprint reduction and jurisdictional arbitrage
Amount of Tax Haven Connections (Figure 1, Page 11), Amount of Tax Haven Profits (Figure 4, Page 16)
"Ireland solidifies its position as the #1 tax haven," Zucman said on Twitter. "U.S. firms book more profits in Ireland than in China, Japan, Germany, France & Mexico combined. Irish tax rate: 5.7%."
But the CEA did not misinterpret the Desai, Foley, and Hines paper.
Some economists champion tax havens. In an article in the Journal of Economic Perspectives published last fall (also titled "Treasure Islands"), James R. Hines Jr. of the University of Michigan argued that they contribute to financial market competition, encourage investment in high-tax countries and promote economic growth. Like many economists, Professor Hines expresses far more confidence in the market than in the state. He worries more about possible overtaxation than about undertaxation of corporate income. He does not engage with such concepts as "tax justice."
With a conservatively estimated annual revenue loss of USD 100 to 240 billion, the stakes are high for governments around the world. The impact of BEPS on developing countries, as a percentage of tax revenues, is estimated to be even higher than in developed countries.
TAX HAVENS: 1.Andorra 2.Anguilla 3.Antigua and Barbuda 4.Aruba 5.Bahamas 6.Bahrain 7.Barbados 8.Belize 9.British Virgin Islands 10.Cook Islands 11.Dominica 12.Gibraltar 13.Grenada 14.Guernsey 15.Isle of Man 16.Jersey 17.Liberia 18.Liechtenstein 19.Maldives 20.Marshall Islands 21.Monaco 22.Montserrat 23.Nauru 24.Net Antilles 25.Niue 26.Panama 27.Samoa 28.Seychelles 29.St. Lucia 30.St. Kitts & Nevis 31.St. Vincent and the Grenadines 32.Tonga 33.Turks & Caicos 34.U.S. Virgin Islands 35.Vanuatu
EU State Aid Rules and the investigation into preferential tax ruling involving Apple Inc. will be on the agenda when the Committee on Finance, Public Expenditure and Reform, and Taoiseach meets tomorrow [..]
Although tax havens have attracted widespread interest (and a considerable amount of opprobrium) in recent years, there is no standard definition of what this term means. Typically, the term is applied to countries and territories that offer favorable tax regimes for foreign investors.
US companies are by far the biggest users of tax havens, where they face effective tax rates of just seven percent, according to the study by economists Thomas Wright and Gabriel Zucman.
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance' (Hines, 2008). In this paper, I will use the expression 'tax haven' and 'offshore financial center' interchangeably (the list of tax havens considered by Dharmapala and Hines (2009) is identical to the list of offshore financial centers considered by the Financial Stability Forum (IMF, 2000), barring minor exceptions)
As a result of the Bush Administration's efforts, the OECD backed away from its efforts to target "harmful tax practices" and shifted the scope of its efforts to improving exchanges of tax information between member countries.
For example, according to the UK Treasury, on the surface it looks like Britain's second-biggest investor is the Netherlands. But the UK Treasury has admitted most of those investments actually consist of British cash that has been sent to Holland for tax purposes and rerouted back home. So, Britain's second biggest foreign investor is itself.
Tax Havens by Most Cited
Offshore Financial Centres by Most Cited
The study estimating the extent of global private financial wealth held in offshore accounts - excluding non-financial assets such as real estate, gold, yachts and racehorses - puts the sum at between $21 and $32 trillion.
The move brought the list down to five non-cooperative jurisdictions - Samoa, Trinidad and Tobago and the three US territories of American Samoa, Guam, and the US Virgin Islands.
Ireland has been likened to a tax haven in a new report which was overwhelmingly accepted by the European Parliament.
The 'tax havens' are locations with very low tax rates and other tax attributes designed to appeal to foreign investors.
Tax havens are typically small, well-governed states that impose low or zero tax rates on foreign investors.
The four OECD member countries Luxembourg, Ireland, Belgium, and Switzerland, which can also be regarded as tax havens for multinationals because of their special tax regimes.
The 'tax havens' are locations with very low tax rates and other tax attributes designed to appeal to foreign investors.
(From abstract) In this paper we argue that such claims rest on poor data and analysis, and on mistakes about how financial transactions, international taxation, and anti-money laundering rules actually work.
While lawmakers generally refer to the new system as a "territorial" tax system, it is more appropriately described as a hybrid system.
The use of private 'unlimited liability company' (ULC) status, which exempts companies from filing financial reports publicly. The fact that Apple, Google and many others continue to keep their Irish financial information secret is due to a failure by the Irish government to implement the 2013 EU Accounting Directive, which would require full public financial statements, until 2017, and even then retaining an exemption from financial reporting for certain holding companies until 2022
Various attempts have been made to identify and list tax havens and offshore finance centres (OFCs). This Briefing Paper aims to compare these lists and clarify the criteria used in preparing them.
There is no generally agreed definition of what a tax haven is.
We've criticised for years the farcical nature of 'tax haven' blacklists, whether EU or OECD ones. They all turn out to be politicised, misleading and ineffective
But on another level this is an Irish version of a phenomenon we've encountered across the tax haven world: the state 'captured' by offshore financial services.
Local subsidiaries of multinationals must always be required to file their accounts on public record, which is not the case at present. Ireland is not just a tax haven at present, it is also a corporate secrecy jurisdiction.
The equivalent of 10% of global GDP is held offshore by rich individuals in the form of bank deposits, equities, bonds and mutual fund shares, most of the time in the name of faceless shell corporations, foundations and trusts.
Jersey bet its future on finance but since 2007 it has fallen on hard times and is heading for bankruptcy. Is the island's perilous present Britain's bleak future?
James Henry, former chief economist at consultancy McKinsey and an expert on tax havens, has compiled the most detailed estimates yet of the size of the offshore economy in a new report, The Price of Offshore Revisited, released exclusively to the Observer.
Jersey is what we call a captured state
All havens are "captured" by offshore finance: local democracy mustn't be allowed to get in the way of making money. [..] In 2014 the "big four" accountancy firms, key architects of the global offshore system, advertised in Hong Kong newspapers urging democracy demonstrators to pipe down, saying the protests would scare away their financial and multinational clients, with "a long-term impact on Hong Kong's status as a global financial centre".
TWO YEARS AFTER the controversial 'double Irish' loophole was closed to new entrants, Google continued using the system to funnel billions in untaxed profits to Bermuda.
Obviously many countries in the European Union are places where aggressive tax optimisation finds its place," Pierre Moscovici, the European commissioner for economic affairs and taxation, told reporters in Brussels yesterday. "Some European countries are black holes. . . I want to address this.
First, many these claims rest heavily on work done by James Hines of the University of Michigan and a few others – research that is fatally flawed.
It focuses particularly on the dominant approach within the economics literature on income shifting, which dates back to Hines and Rice (1994) and which we refer to as the "Hines-Rice" approach.
Intellectual property (IP) has become the leading tax avoidance vehicle in the world today.
Tax havens are typically small, well-governed states that impose low or zero tax rates on foreign investors.
Table 1: 52 Tax Havens
Germany taxes only 5% of the active foreign business profits of its resident corporations. [..] Furthermore, German firms do not have incentives to structure their foreign operations in ways that avoid repatriating income. Therefore, the tax incentives for German firms to establish tax haven affiliates are likely to differ from those of U.S. firms and bear strong similarities to those of other G-7 and OECD firms.
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance. They attract disproportionate shares of world foreign direct investment, and, largely as a consequence, their economies have grown much more rapidly than the world as a whole over the past 25 years.
ABSTRACT: Per capita real GDP in tax haven countries grew at an average annual rate of 3.3 percent between 1982 and 1999, which compares favorably to the world average of 1.4 percent.
We identify 41 countries and regions as tax havens for the purposes of U. S. businesses. Together the seven tax havens with populations greater than one million (Hong Kong, Ireland, Liberia, Lebanon, Panama, Singapore, and Switzerland) account for 80 percent of total tax haven population and 89 percent of tax haven GDP.
According to economics professor James Hines, tax havens serve as healthy competition for high-tax countries, nudging them toward less-restrictive financial policy. By providing alternatives to tightly controlled financial sectors, Hines wrote in a 2010 paper, tax havens discourage regulations that act as "a drag on local economies."
A country with little or no taxation that offers foreign individuals or corporations residency so that they can avoid tax at home.
A tax haven is a country or place which has a low rate of tax so that people choose to live there or register companies there in order to avoid paying higher tax in their own countries.
a place where people pay less tax than they would pay if they lived in their own country
The 'tax havens' are locations with very low tax rates and other tax attributes designed to appeal to foreign investors.
Tax havens are typically small, well-governed states that impose low or zero tax rates on foreign investors.
The use of private 'unlimited liability company' (ULC) status, which exempts companies from filing financial reports publicly. The fact that Apple, Google and many others continue to keep their Irish financial information secret is due to a failure by the Irish government to implement the 2013 EU Accounting Directive, which would require full public financial statements, until 2017, and even then retaining an exemption from financial reporting for certain holding companies until 2022
Local subsidiaries of multinationals must always be required to file their accounts on public record, which is not the case at present. Ireland is not just a tax haven at present, it is also a corporate secrecy jurisdiction.
Various attempts have been made to identify and list tax havens and offshore finance centres (OFCs). This Briefing Paper aims to compare these lists and clarify the criteria used in preparing them.
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance' (Hines, 2008). In this paper, I will use the expression 'tax haven' and 'offshore financial center' interchangeably (the list of tax havens considered by Dharmapala and Hines (2009) is identical to the list of offshore financial centers considered by the Financial Stability Forum (IMF, 2000), barring minor exceptions)
Such profit shifting leads to a total annual revenue loss of $250 billion globally
With a conservatively estimated annual revenue loss of USD 100 to 240 billion, the stakes are high for governments around the world. The impact of BEPS on developing countries, as a percentage of tax revenues, is estimated to be even higher than in developed countries.
The equivalent of 10% of global GDP is held offshore by rich individuals in the form of bank deposits, equities, bonds and mutual fund shares, most of the time in the name of faceless shell corporations, foundations and trusts.
TAX HAVENS: 1.Andorra 2.Anguilla 3.Antigua and Barbuda 4.Aruba 5.Bahamas 6.Bahrain 7.Barbados 8.Belize 9.British Virgin Islands 10.Cook Islands 11.Dominica 12.Gibraltar 13.Grenada 14.Guernsey 15.Isle of Man 16.Jersey 17.Liberia 18.Liechtenstein 19.Maldives 20.Marshall Islands 21.Monaco 22.Montserrat 23.Nauru 24.Net Antilles 25.Niue 26.Panama 27.Samoa 28.Seychelles 29.St. Lucia 30.St. Kitts & Nevis 31.St. Vincent and the Grenadines 32.Tonga 33.Turks & Caicos 34.U.S. Virgin Islands 35.Vanuatu
Tax havens are low-tax jurisdictions that offer businesses and individuals opportunities for tax avoidance. They attract disproportionate shares of world foreign direct investment, and, largely as a consequence, their economies have grown much more rapidly than the world as a whole over the past 25 years.
ABSTRACT: Per capita real GDP in tax haven countries grew at an average annual rate of 3.3 percent between 1982 and 1999, which compares favorably to the world average of 1.4 percent.
As a result of the Bush Administration's efforts, the OECD backed away from its efforts to target "harmful tax practices" and shifted the scope of its efforts to improving exchanges of tax information between member countries.
The eight major pass-through economies—the Netherlands, Luxembourg, Hong Kong SAR, the British Virgin Islands, Bermuda, the Cayman Islands, Ireland, and Singapore—host more than 85 percent of the world's investment in special purpose entities, which are often set up for tax reasons.
The OECD is clearly ill-equipped to deal with tax havens, not least as many of its members, including the UK, Switzerland, Ireland and the Benelux countries are themselves considered tax havens
IMF Working Paper 07/87
{{cite journal}}: Cite journal requires |journal= (help)We identify 41 countries and regions as tax havens for the purposes of U. S. businesses. Together the seven tax havens with populations greater than one million (Hong Kong, Ireland, Liberia, Lebanon, Panama, Singapore, and Switzerland) account for 80 percent of total tax haven population and 89 percent of tax haven GDP.
Alex Cobham of the Tax Justice Network said: It's disheartening to see the OECD fall back into the old pattern of creating 'tax haven' blacklists on the basis of criteria that are so weak as to be near enough meaningless, and then declaring success when the list is empty."
The 17 countries on the European list are American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macau, the Marshall Islands, Mongolia, Namibia, Palau, Panama, St Lucia, Samoa, Trinidad & Tobago, Tunisia and the UAE
It was certainly an improvement on the list recently published by the Organisation for Economic Co-operation and Development, which featured only one name – Trinidad & Tobago – but campaigners believe the European Union has much more to do if it is to prove it is serious about addressing tax havens.
EU members were not screened but Oxfam said that if the criteria were applied to publicly available information the list should feature 35 countries including EU members Ireland, Luxembourg, the Netherlands and Malta
Appendix Table 2: Tax Havens
New Gabriel Zucman study claims State shelters more multinational profits than the entire Caribbean
{{cite journal}}: Cite journal requires |journal= (help)"Ireland solidifies its position as the #1 tax haven," Zucman said on Twitter. "U.S. firms book more profits in Ireland than in China, Japan, Germany, France & Mexico combined. Irish tax rate: 5.7%."
U.S. companies are the most aggressive users of profit-shifting techniques, which often relocate paper profits without bringing jobs and wages, according to the study by economists Thomas Torslov and Ludvig Wier of the University of Copenhagen and Gabriel Zucman of the University of California, Berkeley
Members of the European Parliament have voted to include the Netherlands, Ireland, Luxembourg, Malta and Cyprus on the official EU tax haven blacklist.
The Republic helps big multinationals to engage in aggressive tax planning and the European Commission should regard it as one of five "EU tax havens" until substantial tax reforms are implemented.
Table 1: Jurisdictions Listed as Tax Havens or Financial Privacy Jurisdictions and the Sources of Those Jurisdictions
There is no single definition of a tax haven, although there are a number of commonalities in the various concepts used
Although tax havens have attracted widespread interest (and a considerable amount of opprobrium) in recent years, there is no standard definition of what this term means. Typically, the term is applied to countries and territories that offer favorable tax regimes for foreign investors.
Figure D: Tax Haven Literature Review: A Typology
Tax Havens by Most Cited
[In the Whitehouse advocating for the TCJA] Applying Hines and Rice's (1994) findings to a statutory corporate rate reduction of 15 percentage points (from 35 to 20 percent) suggests that reduced profit shifting would result in more than $140 billion of repatriated profit based on 2016 numbers.
Concerning the characterization of tax havens, we follow the definition proposed by Hines and Rice (1994) which has been recently used by Dharmapala and Hines (2009).
The four OECD member countries Luxembourg, Ireland, Belgium, and Switzerland, which can also be regarded as tax havens for multinationals because of their special tax regimes.
One of the criteria, for example, is that a country must be at least "largely compliant" with the Exchange Of Information on Request standard, a bilateral country-to-country information exchange. According to Turner, this standard is outdated and has been proven to not really work.
Ireland does not meet any of the OECD criteria for being a tax haven but because of its 12.5 per cent corporation tax rate and the open nature of the Irish economy, Ireland has on a few occasions been labeled a tax haven.
Some experts see no difference between tax havens and OFCs and employ the terms interchangeably.
Yet today it is difficult to distinguish between the activities of tax havens and OFCs.
It focuses particularly on the dominant approach within the economics literature on income shifting, which dates back to Hines and Rice (1994) and which we refer to as the "Hines-Rice" approach.
We've criticised for years the farcical nature of 'tax haven' blacklists, whether EU or OECD ones. They all turn out to be politicised, misleading and ineffective
The new research draws on data from countries such as Ireland, Luxembourg and the Netherlands that hadn't previously been collected.
Study claims State shelters more multinational profits than the entire Caribbean
Brussels. 30.8.2016 C(2016) 5605 final. Total Pages (130)
James Henry, former chief economist at consultancy McKinsey and an expert on tax havens, has compiled the most detailed estimates yet of the size of the offshore economy in a new report, The Price of Offshore Revisited, released exclusively to the Observer.
The study estimating the extent of global private financial wealth held in offshore accounts - excluding non-financial assets such as real estate, gold, yachts and racehorses - puts the sum at between $21 and $32 trillion.
Mr Henry said his $21tn is actually a conservative figure and the true scale could be $32tn. A trillion is 1,000 billion. Mr Henry used data from the Bank of International Settlements, International Monetary Fund, World Bank, and national governments.
US companies are by far the biggest users of tax havens, where they face effective tax rates of just seven percent, according to the study by economists Thomas Wright and Gabriel Zucman.
First, many these claims rest heavily on work done by James Hines of the University of Michigan and a few others – research that is fatally flawed.
According to economics professor James Hines, tax havens serve as healthy competition for high-tax countries, nudging them toward less-restrictive financial policy. By providing alternatives to tightly controlled financial sectors, Hines wrote in a 2010 paper, tax havens discourage regulations that act as "a drag on local economies."
Some economists champion tax havens. In an article in the Journal of Economic Perspectives published last fall (also titled "Treasure Islands"), James R. Hines Jr. of the University of Michigan argued that they contribute to financial market competition, encourage investment in high-tax countries and promote economic growth. Like many economists, Professor Hines expresses far more confidence in the market than in the state. He worries more about possible overtaxation than about undertaxation of corporate income. He does not engage with such concepts as "tax justice."
Offshore Financial Centres by Most Cited
Although a previous literature has modelled tax havens as a benign phenomenon that helps high-tax countries reduce the negative impact of their own suboptimal domestic tax policies, there is considerable concern that the havens are "parasitic" on the tax revenues of the non-haven countries
For example, according to the UK Treasury, on the surface it looks like Britain's second-biggest investor is the Netherlands. But the UK Treasury has admitted most of those investments actually consist of British cash that has been sent to Holland for tax purposes and rerouted back home. So, Britain's second biggest foreign investor is itself.
Germany taxes only 5% of the active foreign business profits of its resident corporations. [..] Furthermore, German firms do not have incentives to structure their foreign operations in ways that avoid repatriating income. Therefore, the tax incentives for German firms to establish tax haven affiliates are likely to differ from those of U.S. firms and bear strong similarities to those of other G-7 and OECD firms.
Applying Hines and Rice's (1994) findings to a statutory corporate rate reduction of 15 percentage points (from 35 to 20 percent) suggests that reduced profit shifting would result in more than $140 billion of repatriated profit based on 2016 numbers.
But the CEA did not misinterpret the Desai, Foley, and Hines paper.
[..] "the captured state": a world in which policymaking has been largely taken over by financial interests that can pick and choose between jurisdictions and in effect write the laws they need. "That happens in its purest form in the very small tax havens where there is just no local democracy to do anything.
Jersey is what we call a captured state
All havens are "captured" by offshore finance: local democracy mustn't be allowed to get in the way of making money. [..] In 2014 the "big four" accountancy firms, key architects of the global offshore system, advertised in Hong Kong newspapers urging democracy demonstrators to pipe down, saying the protests would scare away their financial and multinational clients, with "a long-term impact on Hong Kong's status as a global financial centre".
But on another level this is an Irish version of a phenomenon we've encountered across the tax haven world: the state 'captured' by offshore financial services.
As already noted, one of Luxembourg's key selling points for the world's mobile hot money has long been Luxembourg's role as a state 'captured' by offshore financial services, which has effectively removed the possibility of democratic opposition to the sector.
EU State Aid Rules and the investigation into preferential tax ruling involving Apple Inc. will be on the agenda when the Committee on Finance, Public Expenditure and Reform, and Taoiseach meets tomorrow [..]
Intellectual property (IP) has become the leading tax avoidance vehicle in the world today.
ANDREA KELLY (PwC Ireland): "We expect most Irish QIAIFs to be structured as ICAVs from now on and given that ICAVs are superior tax management vehicles to the Cayman Island SPCs, Ireland should attract substantial re-domiciling business
Obviously many countries in the European Union are places where aggressive tax optimisation finds its place," Pierre Moscovici, the European commissioner for economic affairs and taxation, told reporters in Brussels yesterday. "Some European countries are black holes. . . I want to address this.
The move brought the list down to five non-cooperative jurisdictions - Samoa, Trinidad and Tobago and the three US territories of American Samoa, Guam, and the US Virgin Islands.
Ireland has been likened to a tax haven in a new report which was overwhelmingly accepted by the European Parliament.
Brussels is challenging the "Double Irish" tax avoidance measure prized by big U.S. tech and pharma groups, putting pressure on Dublin to close it down or face a full-blown investigation. [..] The initial enquiries have signalled that Brussels wants Dublin to call time on the tax gambit, which has helped Ireland become a hub for American tech and pharma giants operating in Europe.
TWO YEARS AFTER the controversial 'double Irish' loophole was closed to new entrants, Google continued using the system to funnel billions in untaxed profits to Bermuda.
So, if you think about a lot of technology companies that are housed in Ireland and have massive operations there, they're not going to maybe need those in the same way, and those can be relocated back to the U.S.
"Right now, it's safe to say that the U.K. is the preferred country of destination for inverted companies, given the favorable tax regime and the non-tax attractions of the U.K.," said Mr. Willens, a former managing director at Lehman Brothers.
In 2007 to 2009, WPP, United Business Media, Henderson Group, Shire, Informa, Regus, Charter and Brit Insurance all left the UK. By 2015, WPP, UBM, Henderson Group, Informa and Brit Insurance have all returned
While lawmakers generally refer to the new system as a "territorial" tax system, it is more appropriately described as a hybrid system.
Such profit shifting leads to a total annual revenue loss of $250 billion globally
U.S. companies are the most aggressive users of profit-shifting techniques, which often relocate paper profits without bringing jobs and wages, according to the study by economists Thomas Torslov and Ludvig Wier of the University of Copenhagen and Gabriel Zucman of the University of California, Berkeley
The new research draws on data from countries such as Ireland, Luxembourg and the Netherlands that hadn't previously been collected.
"Right now, it's safe to say that the U.K. is the preferred country of destination for inverted companies, given the favorable tax regime and the non-tax attractions of the U.K.," said Mr. Willens, a former managing director at Lehman Brothers.