Oxfam recently published their list of the “World’s Worst Corporate Tax Havens”. Ironically, the very reasons why Oxfam ranks these countries as the “world’s worst” are the exact same reasons why mega-wealthy corporations and individuals will view this list as a “go-to guide”!
Like UNICEF, Oxfam are synonymous with global aid, an organization that does so much good in the world it is beyond any form of reproach, and rightly regarded as one of the world’s greatest institutions. Oxfam has been doing amazing things since being founded in 1942 in Oxfordshire, Great Britain as the “Oxford Committee For Famine Relief” by Cecil Jackson-Cole. The first oversees branch of Oxfam was founded in Canada in 1963, and while its headquarters remain in Oxford, Oxfam now has affiliate branches in 14 locations, including the USA, Australia, France, Germany and India.
Oxfam’s continuing goal is to feed, clothe and help the starving, impoverished and destitute of the world, something they have been doing with great success for more than six decades. Millions have benefited from the efforts of Oxfam volunteers, from those who work in the high street Oxfam shops, to those heroic volunteers who directly help in the never-ending struggle to feed the starving in Asia and Africa.
Oxfam Inadvertently Reveals World’s Top Tax Havens
Through extensive investigation, Oxfam have discovered that 90% of the world’s biggest companies and corporations have a footing in a tax haven, and as a result, pay a fraction of the tax that they should, and because of this corporate tax dodging, the poorest countries remain poor, and children in developing nations who manage to survive often miss out on basic healthcare and education.
Oxfam would prefer it if major corporations would either pay their appropriate taxes thus allowing their governments to contribute to charities, or ideally, give large sums directly to charities like themselves as a legitimate form of tax exemption. Because many corporations, do neither, Oxfam annually exposes the countries that are providing taxation shelter for many of these companies.
Of course, while Oxfam labels them “The World’s Worst Corporate Tax Havens”, rich individuals, investors and owners of businesses the world over will look upon such a well-researched list as vindication that these countries are the best in the business when it comes to tax shelters.
Oxfam based their list on such practices as “offering unfair and unproductive tax incentives” and “zero or extremely low corporate tax rates”, plus a “failure to co-operate with international processes to combat tax avoidance”, which will be music to the ears of many businesses.
Here are the World’s Worst Corporate Tax Havens according to Oxfam:
(2) the Cayman Islands
(3) the Netherlands
(9) Hong Kong
(11) the Bahamas
(14) Mauritius and
(15) the British Virgin Islands
The inclusion of Bermuda, the Cayman Islands, Curacao, the Bahamas, Barbados, Mauritius and the British Virgen Islands is no great surprise, as the Caribbean is synonymous with discreet banking and lox if any taxation. The estimates as to how much corporate cash is stashed in Caribbean bank accounts varies from $20-40 trillion. More surprising is the omission of countries like St Kitts and Nevis, Antigua and Barbuda and Grenada, all of whom offer discreet offshore banking.
Interestingly, while the UK is not on the list, Bermuda, the Caymans, Jersey and the British Virgin Islands are, and all four are UK overseas dependencies and classed as sovereign British territories.
Four of the countries on the list are EU member states, the Netherlands, Switzerland, Luxembourg and Ireland, while Jersey has a “special relationship” with the European Union in which the island is treated as part of the EU for the purposes of free trade, but is not actually a bona-fide EU member state.
More and more of the world’s biggest corporations are now basing their European headquarters in the Netherlands, where extremely lenient corporate taxation rates are offered to foreign companies. Eighty of the 100 largest companies worldwide are registered in Holland, as well as 48% of Fortune 500 companies. It is also easy to set up a “shelter company” in the Netherlands, literally all one needs to do so is a mailbox. There are 12,000 such “mailbox companies” in Holland, channeling some €4 billion in assets, which is in itself a world record.
Switzerland and Jersey have long been regarded as tax havens. Switzerland was until recently synonymous with ultra-discreet banking, but have been forced to come into line with EU regulations and now must provide full disclosure, if called upon. However, they still offer enticing rates of corporate tax to major companies, as do Jersey and Ireland. Post Brexit Britain looks set to join these countries – and possibly even surpass them – as a corporate tax haven in the coming years, as they look for ways to stimulate their economy and attract big business after leaving the EU.
In summary, Oxfam are as noble an organization as one is likely to find, especially in an age where morals and standards are issues forever in debate. Ideally we would all like to see an end to the third world, and if the leaders of the world’s corporations ever put their collective heads together, they could without doubt supply the funds to take steps toward achieving that, just with the money they save on tax avoidance.
The flip side of this argument is that smaller businesses often find it almost impossible to grow because of stifling taxation in their own country, and when they read that an online retail company named after a river is paying less tax than they are despite being one of the wealthiest companies in history, it must make them feel like giving up. This article is aimed at showing them they have options regarding where they choose to base themselves in the future. Maybe once they make it big themselves, they will take organizations like Oxfam into consideration and decide to help them, maybe even set a standard for the future.
While 2ndPassports.com is primarily a second citizenship specialist organization, we also offer unbeatable corporate advice on offshore banking and tax shelters. Feel free to contact us via email, WhatsApp or Telegram. If you prefer you can chat to one of our expert representatives directly – you can call us using our encrypted phone and Skype lines. All of our contact details are listed at the top of the 2ndPassports.com homepage.
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