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Tax Havens

Tax Havens Require Political and Economic Stability to Flourish

Without political and economic stability, no amount of tax inducement can bring in outside investors. The political and economic stability of tax havens like Switzerland are a magnet for huge capital inflows.

Lack of Exchange Controls Offer Investor Confidence

The key reason Hong Kong is among the world’s largest financial centres is that it doesn’t have any currency controls.

Bank Secrecy in Tax Havens

Bank secrecy is a legal requirement in most tax havens and this prohibits banks providing authorities personal and account information about their customers.

Asset Protection

The Cook Islands claims to be the first country to have enacted an explicit asset protection law (in 1989 with its International Trusts Act).

Locating Holding Companies

Locating a holding company in a tax haven can be used to bring together investors from various countries who are investing in businesses that are in turn operating in numerous countries.

Legal Reasons to Use a Tax Haven

Many taxpayers, especially multi-national corporations, can legally save tax by structuring their affairs to use a tax haven.

Who Uses Tax Havens?

Tax havens can be used by individuals, small businesses, large businesses, Fortune 500 companies, governments, charities, and non-profit organisations.

Wealth in Tax Havens

The Tax Justice Network (an anti-tax haven pressure group) estimated that capital held offshore amounted to between $21 trillion and $32 trillion (between 24–32% of total global investments).

Benefits for Tax Haven Countries

Countries restructure and redesign their tax system to become a tax haven for two main reasons – jobs and money.

Oldest Tax Haven

Switzerland was the first "true" tax haven and became a tax haven immediately following World War I.