The World's Largest Tax Haven

From: Jurriaan Bendien (andromeda246@HETNET.NL)
Date: Wed May 19 2004 - 17:14:09 EDT

This is quite an interesting clip on the taxation issue:

Since the '80s the US has been the largest tax and regulatory haven for
non-resident foreign nationals in the world. Starting in the early 1980s the
United States was made into the largest tax and regulatory haven in the
world for foreign nationals not resident in the US. Today a foreigner can
buy the newly issued Reg. S stock of a US company at a discount because the
company does not have to register those shares with the Securities Exchange
Commission. Foreigners can sell those shares back into the US forty days
later without paying any tax on the trading profits to the US government.
They can open bank accounts or buy the debt instruments of government and
private borrowers and earn interest in the US tax free.

This was done pursuant to a deliberate national policy change in the early
l980s. At that time many of America's top financial institutions were
technically bankrupt. The combination of uncollectible bank loans to the
third world and a 20%+ prime rate had put billion dollar holes in the
balance sheets of banks and insurance companies. The solution was simple and
effective - drop taxes on international capital and watch the money flow
back into America's financial institutions.

This policy change has been wildly successful, pulling in trillions of
dollars of capital into the US economy. It's not surprising therefore to see
that Delaware, Wyoming and a number of other states, using the Limited
Liability Company ("LLC") - a form of business entity generally requiring
less legal formalities than do corporations and that has members rather than
shareholders - have received sanction as international tax avoidance

The US has numerous tax treaties and, like many nations, complicated,
ever-changing tax laws administered by an often confused or irrational tax
bureaucracy. If more than $10.000 is taken into or out of the US, outside of
normal banking channels, a report must be filed with the customs

Complete article at:

This archive was generated by hypermail 2.1.5 : Thu May 20 2004 - 00:00:01 EDT