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04-08-2014, 01:50 AM
An honorable member of the Coffee Shop Has Just Posted the Following:
UK fails to get tax-evasion windfall
The Sunday Times, 3 August 2014, page 24
When the British tax authorities struck a landmark deal with the Swiss to crack down on tax evasion, they sat back and waited for the cash to flow in.
Almost three years later, they are still waiting. So far, only US$1.7 billion (S$2.1 billion) of the US$8.4 billion windfall they expected has materialised, and the sheepish tax authorities now hope to collect just a third of their original estimate.
The deal struck by Britain, which once seemed a pioneer in combating tax evasion, is emerging as a cautionary tale for a growing number of nations that are feeling the pinch of Europe’s flat economy and are desperate to reap revenues from secret accounts held by the wealthy.
The amounts at stake are enormous. In 2012, the British government estimated that Britons had amassed more than US$68.5 billion in Swiss banks. Some conservative estimates of the amount of money tucked away in tax havens and out of reach of governments worldwidego as high as US$21 trillion - more than the gross domestic product of the United States.
The British tax authorities are now facing increasing pressure to act more aggressively. But as the British deal has shown, the efforts to reduce tax avoidance by striking deals with individual havens are akin to plugging one hole in a colander.
Asked by lawmakers last month about the missing billions, Mr Jim Harra, director-general for business tax at Britain’s tax collection authority, said it was "a concern that we have had all along that as the Swiss agreement began to bite, that people would then move their money elsewhere". In short, he conceded, they took the money and ran.
The lesson is that "you cannot rely on a black hole to get income", according to Mr Pascal SaintAmans, a tax expert with the Organisation for Economic Cooperation and Development, based in Paris. The organisation is developing standards for a broader international deal. So far 60 jurisdictions and nations, including Switzerland, have committed themselves. But that agreement is not expected to take effect until 2017, and critics are already pointing out loopholes.
Britain's deal with Switzerland had plenty of its own. For those who wanted to evade the British tax authorities, the agreement gave ample warning - 16 months - to shift money to other offshore havens or put it into gold, bearer funds, artwork, insurance or safe deposit boxes.
Other money is hidden in ever more elaborate mazes of offshore trusts and foundations often managed by trustees, usually foreign lawyers, allowing the real beneficiaries to remain secret.
Under the deal with Switzerland, about 18,000 Britons disclosed their names to the British authorities. Those who did not want to be identified paid a one-time levy of up to 34 per cent to settle past taxes.
But recently, the Swiss sent the British a list of the international jurisdictions that had received money from accounts held by Britons in Switzerland before the deductions could be made. Mr Jason Collins, a tax lawyer with Pinsent Masons in London, said the likely locations include Singapore and Dubai. Other experts see money shifting to Hong Kong, Mauritius and Seychelles.
Click here to view the whole thread at www.sammyboy.com (http://singsupplies.com/showthread.php?187157-Sinkapore-is-a-tax-evaders-haven&goto=newpost).
UK fails to get tax-evasion windfall
The Sunday Times, 3 August 2014, page 24
When the British tax authorities struck a landmark deal with the Swiss to crack down on tax evasion, they sat back and waited for the cash to flow in.
Almost three years later, they are still waiting. So far, only US$1.7 billion (S$2.1 billion) of the US$8.4 billion windfall they expected has materialised, and the sheepish tax authorities now hope to collect just a third of their original estimate.
The deal struck by Britain, which once seemed a pioneer in combating tax evasion, is emerging as a cautionary tale for a growing number of nations that are feeling the pinch of Europe’s flat economy and are desperate to reap revenues from secret accounts held by the wealthy.
The amounts at stake are enormous. In 2012, the British government estimated that Britons had amassed more than US$68.5 billion in Swiss banks. Some conservative estimates of the amount of money tucked away in tax havens and out of reach of governments worldwidego as high as US$21 trillion - more than the gross domestic product of the United States.
The British tax authorities are now facing increasing pressure to act more aggressively. But as the British deal has shown, the efforts to reduce tax avoidance by striking deals with individual havens are akin to plugging one hole in a colander.
Asked by lawmakers last month about the missing billions, Mr Jim Harra, director-general for business tax at Britain’s tax collection authority, said it was "a concern that we have had all along that as the Swiss agreement began to bite, that people would then move their money elsewhere". In short, he conceded, they took the money and ran.
The lesson is that "you cannot rely on a black hole to get income", according to Mr Pascal SaintAmans, a tax expert with the Organisation for Economic Cooperation and Development, based in Paris. The organisation is developing standards for a broader international deal. So far 60 jurisdictions and nations, including Switzerland, have committed themselves. But that agreement is not expected to take effect until 2017, and critics are already pointing out loopholes.
Britain's deal with Switzerland had plenty of its own. For those who wanted to evade the British tax authorities, the agreement gave ample warning - 16 months - to shift money to other offshore havens or put it into gold, bearer funds, artwork, insurance or safe deposit boxes.
Other money is hidden in ever more elaborate mazes of offshore trusts and foundations often managed by trustees, usually foreign lawyers, allowing the real beneficiaries to remain secret.
Under the deal with Switzerland, about 18,000 Britons disclosed their names to the British authorities. Those who did not want to be identified paid a one-time levy of up to 34 per cent to settle past taxes.
But recently, the Swiss sent the British a list of the international jurisdictions that had received money from accounts held by Britons in Switzerland before the deductions could be made. Mr Jason Collins, a tax lawyer with Pinsent Masons in London, said the likely locations include Singapore and Dubai. Other experts see money shifting to Hong Kong, Mauritius and Seychelles.
Click here to view the whole thread at www.sammyboy.com (http://singsupplies.com/showthread.php?187157-Sinkapore-is-a-tax-evaders-haven&goto=newpost).