Youngsters Struggle to get Mortgages...

''Alpach what you say about Gsy not being an ideal location is a bit of a
contradiction because if it was not ideal then they would not be here''.


TAX HAVEN...mafia money...drug money...blood money....TAX HAVEN....should I continue?

Ah. Austria is even more secret. They were in the OECD shady list for non-cooperation until a recent change. Can't remember the details. In the last few months.

.....sorry

alpbach1 wrote:''Alpach what you say about Gsy not being an ideal location is a bit of a
contradiction because if it was not ideal then they would not be here''.


TAX HAVEN...mafia money...drug money...blood money....TAX HAVEN....should I continue?

And how does that support the arguement that they should be more free with money to young home owners.

Or the arguement that thye should not have plush premises. There will always be iffy money in any jurisdiction, but it is the amount and the efforts to keep it out that counts, but tyhat is another discussion.

When the big banks leave Guernsey(not if but when) the locals will be able to afford hauses at realistic prices!!!!!!!!!!

http://www.thisisguernsey.com/2009/01/13/house-price-average-tops-400k/

PARIS—Austria has been promoted
to the "white list" of countries that comply with international tax
standards, according to the latest progress report by the body leading
a global fight against tax havens.

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Austria had been among several states resisting the adoption of rules on forwarding account details to other tax authorities.
The
change had been expected because Austrian lawmakers voted earlier this
month to relax the country's banking secrecy regulations. The change
paved the pay for the country to be removed from the Paris-based
Organization for Economic Cooperation and Development's "gray list" of
countries not complying with international reporting norms.
The
Austrian Finance Ministry says the country has signed 15 agreements on
double taxation or exchange of information with other countries, a
prerequisite for getting off the gray list. Many more agreements are
being negotiated, ministry spokesman Harald Waiglein said in Vienna.
The gray list still includes nations such as Andorra, Monaco, San Marino, and the British territory of Gibraltar.

fast robert... Austria has been promoted
to the "white list" of countries that comply with international tax
standards....can Guernsey say the same?????????????????????

Clamping down on tax dodgers

At
the beginning of April the world's 20 most powerful countries agreed to
take action – including sanctions – against “un-cooperative” tax
havens. But there are serious doubts about whether such good intentions
will actually come to fruition, or if the threat of punitive actions
can actually workThey were only 30 words tucked away on
page four of a nine-page document which outlined the world’s 20 most
powerful countries’ global plan for recovery and reform. But that was
enough to grab the world’s headlines, and ruffle the feathers of those
countries that were singled out by the Organisation of Economic
Co-operation and Development (OECD) for their lack of appropriate
transparency and their failure to live up to expected international tax
standards.

It is estimated that developing countries lose nearly
US$500bn of tax revenues each year as a consequence of tax avoidance
and evasion. Around US$124bn of this, bigger than the annual overseas
aid budget, is attributed to tax havens. Britain loses around £100bn a
year. Unofficial estimates suggest that £18.5bn of this may relate to
the use of tax havens. The United States is estimated to be losing
around US$345bn of tax revenues each year, around US$100bn of which
relates to tax havens.

John Christensen, director of the
international secretariat of the Tax Justice Network, a campaign group,
says that tax havens, which offer secrecy, low or zero taxation, and
lax regulation (or a combination of all three) allow big companies and
wealthy individuals to benefit from the onshore benefits of tax – like
good infrastructure, education and the rule of law – while using the
offshore world to escape their responsibilities to pay for it. The tax
haven system is also widely used by criminals and terrorists. As a
result, says Christensen, “tax havens are heightening inequality and
poverty, corroding democracy, distorting markets, undermining
regulation and curbing economic growth, accelerating capital flight
from poor countries, and promoting corruption and crime around the
world.”

In a report issued by the US Government Accountability
Office (GAO) in January this year, it found that of the 100 largest
public companies, 83 do business in tax-haven hotspots like the Cayman
Islands, Bermuda and the British Virgin Islands, where they can move
their income into tax-free accounts. Furthermore, 14 companies on the
list had received bailout money from the US Treasury in the recent
financial meltdown. Those on the list include Bank of America, which
received US$45bn (and which has 115 subsidiaries in tax havens);
Citigroup (US$45bn, and 427 subsidiaries in tax havens); American
Express (US$3.4bn, and 39 subsidiaries in tax havens); and Goldman
Sachs, (US$10bn, and 29 subsidiaries in tax havens), according to the
Taxpayers for Common Sense watchdog group.

As a result, the US
is preparing to strike back. On 4 May US President Barack Obama
proposed several measures to address overseas tax avoidance and tax
evasion. The President has proposed to limit the rules allowing
corporations to “defer” their US taxes on foreign income, as well as
proposing steps to reduce abuses of the foreign tax credit and the
“check-the-box” rules that allow multinational corporations to cause
their subsidiaries’ income to “disappear.”

It is not just the
US which has become more concerned about tax avoidance. The topic
appeared as a “major” item in April’s G20 summit in London. The final
communiqué released on 2 April stated that the G20 agree “to take
action against non-cooperative jurisdictions, including tax havens. We
stand ready to deploy sanctions to protect our public finances and
financial systems.” “The era of banking secrecy is over,” it said. At
the same time OECD published a list of countries that have failed – or
refused – to sign up to any international standard for exchange of tax
information. The OECD put Costa Rica, Malaysia, the Philippines and
Uruguay on its blacklist of non-cooperative tax havens. A separate
“grey list” of countries that have agreed to improve transparency
standards but have not yet signed the necessary international accords
included Liechtenstein, Luxembourg, Monaco and Switzerland.

The
statement was applauded by most politicians in the US and Europe.
Members of the European Parliament (MEPs) welcomed the G20 statement
regarding bank secrecy and have lauded automatic exchange of
information as the most effective tool to tackle tax avoidance. MEPs
have also recommended that the EU should adopt at its own level an
appropriate legislative framework regarding tax havens and has called
on its international partners to do the same. The European Parliament
wants the next G20 Summit to agree on co-ordinated and concrete action
both to close down all tax and regulatory havens and to close “onshore”
tax and regulatory loopholes which permit widespread tax avoidance,
even in major financial centres.

But the G20’s 30-word
commitment to curb the secrecy surrounding offshore banking and tax
havens has left a lot of lawyers, campaigners, and tax experts
unimpressed and in search of more answers as to how the intentions will
be enforced. Miles Dean, director at Milestone International Tax
Consultants, says that “the G20 was toothless and has made little
impact on the fight against tax evasion”, adding that it “did nothing
to prevent or clamp down on use of tax havens”. “Labelling
jurisdictions a ‘tax haven’ does not prevent them from being used for
the avoidance of tax,” he says.

Dean says that “corporates will
always seek to legitimately reduce their tax liability since they have
an obligation to their shareholders. Individuals will seek to avoid tax
– through whatever means – if they perceive their liability to tax is
unduly high or that they don’t receive value for money or a combination
of both. Most developed countries have very sophisticated tax systems
and anti-avoidance provisions to stem the flow of capital but they
cannot prevent companies and individuals themselves relocating. In both
instances taxpayers are much more mobile than governments give them
credit for”.

David Whiscombe, director of BKL Tax consultants,
says that the main problem which tax authorities have is that effective
avoidance exploits the apparent inability of legislators to draft
legislation which is sufficiently precise and comprehensive to achieve
the aims of the legislature. As a result, he says, the temptation is
for legislation which (in the UK at least) has traditionally been very
precise and specific to be replaced by so-called ‘principles based’
legislation which will set out in more or less broad terms what it
seeks to achieve leaving the executive and the courts to develop the
principle and apply it to specific circumstances.

“That may be
effective as a flexible tool to counter novel avoidance but it has its
own challenges: mainly that, almost by definition, it leads to
uncertainty for business – indeed its very effectiveness depends on
fuzzy rules,” says Whiscombe. “Nonetheless, that seems to be the way
legislatures are going forward on anti-avoidance rules,” he adds.

Going
after non-cooperative tax havens and jurisdictions is not a new
project. In 1998, under pressure from major European Union countries,
the OECD published a paper on what it called “harmful tax competition”
and, in 2000, published a framework for sharing tax information. In
2002, this became the OECD Model Tax Convention (revised in 2005),
which states that bank secrecy cannot be an obstacle to exchange of
information for tax purposes. The OECD framework encourages
nation-states to sign its Tax Information Sharing Agreement through a
series of bilateral, not multilateral, treaties.

However,
these moves are not without their flaws, says Prem Sikka, professor of
accounting at the University of Essex. He points out that each treaty
would need to be ratified by the parliament of the respective
countries, which means that it is doubtful that poor, developing
countries can muster sufficient political and economic clout to
negotiate a treaty with larger nations. Even if that was possible, due
to organised tax avoidance by multinational companies, many developing
countries do not have effective tax administration structures to make
the relevant requests for information, he says.

While any
assault on tax avoidance, tax havens and banking secrecy may be
welcomed, a number of problems remain – primarily that the G20
statement does not provide any details of possible sanctions. “Can
sanctions really be imposed on countries that are not members of the
OECD or had no say in developing the OECD Model Tax Convention?” asks
Professor Sikka. “Any country escaping the OECD framework is likely to
be attractive to those who value secrecy and tax avoidance. Thus, all
countries need to sign up to the OECD framework and that might only be
possible if the OECD membership is broadened. All that will take time,
although the threat of sanctions has persuaded Andorra, Belgium,
Luxembourg, Switzerland, Hong Kong, China, Monaco, and Singapore to
adopt the OECD standards,” he says.

Furthermore, with
conflicting economic interests and vagaries of language, there is no
guarantee that all states will reach a common understanding of the OECD
framework, especially as tax information sharing is not always
automatic. Under the OECD framework, a state will not always be able to
request information randomly on bank accounts held by its residents
located in the other state.

Perhaps the biggest shortcoming of
the G20 initiative is that it only seems to apply to individuals.
Corporations, partnership trusts and other business vehicles are not
covered by the OECD framework. So individuals could dodge taxes by
making investments through corporate entities. “It is perfectly
possible for UK citizens to form corporate vehicles that are domiciled
in tax havens even though they might trade in Britain or have directors
in this country. Thus these companies are totally beyond the reach of
the G20 agreement,” says Professor Sikka.

Curbing “tax evasion
and tax avoidance” is much bigger than constraining “banking secrecy”,
says Professor Sikka, who points out that many multinational
corporations avoid taxes through complex corporate structures, transfer
pricing and royalty programmes. For example, Bernard Madoff has hidden
his loot in offshore entities. Enron used nearly 3,500 subsidiaries to
avoid taxes in the US, India and Hungary. Many of these were in the
Cayman Islands which do not levy corporate taxes. WorldCom devised a
royalty programme by creating an asset called “management foresight”.
All companies in the group were required to pay royalties. Over a
four-year period, the subsidiaries paid US$20bn in royalty fees. The
paying companies got tax relief on the payment of royalties. However,
since the receiving company was located in a favourable tax
jurisdiction it paid little or no tax on most of its income. The
transaction was internal to the WorldCom group and had no net effect on
its global profits, but saved millions of dollars in taxes.

“The
main problem is that we are using eighteenth century definitions and
legislation to combat a twenty-first century problem,” says Professor
Sikka. “The simplest step to take would be to make sure that companies
are taxed proportionately in the countries where they make their
revenues, rather than where they are registered. That would eliminate
the use of tax havens because very few companies actually make much of
their revenue in places like Jersey,” he says.

Yet while the
world’s most powerful nations have been eager to point the finger at
their weaker counterparts for their failure to clean up their financial
transparency, recent research has found that many OECD approved
countries should not be above such criticism themselves.

The
tub-thumping of the G20 leaders about closing down tax havens in every
territory except their own may have played well in their respective
home countries, but those jurisdictions consigned to the black and grey
lists of the OECD table are far from impressed.

Luxembourg’s
Prime Minister Jean-Claude Juncker – whose tiny country was included in
the “grey” list of “jurisdictions that have committed to the
internationally agreed standard, but have not yet substantially
implemented” alongside such notorious tax havens as the Cayman Islands,
Liechtenstein, and the Turks and Caicos Islands – has said that the
tax-friendly US states of Delaware, Nevada and Wyoming should figure on
an international blacklist of offshore tax havens as well.

A
money-laundering threat assessment in 2005 by the federal government
found that corporate anonymity offered by Delaware, Nevada and Wyoming
rivalled that of familiar offshore financial centres.

Along with
Belgium and Austria, Luxembourg came under pressure from its EU
partners to ease its banking secrecy rules. They have recently agreed
to relax their bank secrecy rules and exchange tax information with
other countries under certain conditions, but only after putting up a
fight. Luxembourg has over the years become a major European financial
hub thanks in large part to its bank secrecy rules and low taxes.

"I
would like all the bold leaders in Europe who insisted that those three
EU countries that practice banking secrecy drop it show the same
courage towards the United States," Juncker said.

"The G20 has
no credibility as an undertaking if Delaware, Wyoming or Nevada or
far-flung islands from the United States are not on the blacklist," he
told lawmakers at the European Parliament in Brussels. "If there must
be a blacklist then, America should have its place on it."

The
three US states are popular locations for incorporating businesses in
large part because of the tax advantages of doing so while the US
Virgin Islands are also known for their tax benefits. "I don't hear any
other prime minister than myself ... raising this problem. Why doesn't
British Prime Minister Brown say to US President Barack Obama to put an
end to the tax havens on American territory.”

Juncker certainly
has a point. In March – one week before the final G20 communique – The
Economist ran an article which examined the efforts of Jason Sharman, a
political scientist at Australia’s Griffith University. Using a budget
of US$10,000, the adverts at the back of the magazine and Google, he
showed how easy it was to circumvent prohibitions on banking secrecy,
forming anonymous shell companies and secret bank accounts across the
world.

During his investigation, Sharman found that there is a
more insidious form of secrecy, in which authorities and bankers do not
bother to ask for names, something long outlawed in offshore tax
centres such as Jersey and Switzerland but which has persisted in the
US. The benefits for shady clients are clear to see: what their bankers
do not know, they can never be forced to reveal.

The US state
of Nevada – which makes a boast of its “limited reporting and
disclosure requirements” – is a case in point. Nevada does not ask for
the names of company shareholders, nor does it routinely share the
little information it has with the federal government. And such an
approach pays dividends to the local economy. The state, with a
population of only 2.6m, incorporates about 80,000 new firms a year and
now has more than 400,000, roughly one for every six people. A study by
the Internal Revenue Service found that 50-90% of those registering
companies were already in breach of federal tax laws elsewhere.

Sharman
also tested several other approved OECD countries. He tried to open
anonymous shell companies and bank accounts 45 times across the world.
These were successful in 17 cases, of which 13 were in OECD countries.
One example was the UK, where in 45 minutes on the internet he formed a
company without providing identification, was issued with bearer shares
(which have been almost universally outlawed because they confer
completely anonymous ownership) as well as nominee directors and a
secretary. All was achieved at a cost of £515.95.

Elsewhere,
Sharman formed companies by providing no more than a scanned copy of
his driving licence. In contrast, when trying to open accounts in
Bermuda and Switzerland, he was asked for documentation such as
notarised copies of his birth certificate. “In practice OECD countries
have much laxer regulation on shell corporations than classic tax
havens,” he said. “And the US is the worst on this score, worse than
Liechtenstein and worse than Somalia.”

http://www.europeanceo.com/magazine-articles/article538.html

Alpach

Guernsey is on the white list. Do you not know that?

3 April 2009

Guernsey has welcomed its ‘white listing’
by the OECD as a result of the G20 summit in London.

Chief Minister Lyndon Trott said that the Island’s
inclusion on a white list with some of the world’s top financial
centres cemented Guernsey’s position as an internationally compliant
and transparent low tax jurisdiction.

“It has been a long and hard process to get where
we are today. Recognition as a jurisdiction which has substantially implemented
the internationally-agreed tax standard is nothing more than we deserve,”
said the Chief Minister.

“We are a well-regulated, transparent, co-operative
jurisdiction and the internationally community appears to have embraced
that message. I see the news as a massive boost for business in Guernsey
and the Island’s economy.”

Guernsey has signed 13 Tax Information Exchange Agreements
and is preparing to sign more as an indication of its commitment to international
recognition.

The Chief Minister added: “We have made it clear
throughout the international banking crisis that we did not export instability,
we were subjected to it. I believe this validation of Guernsey by the
OECD is an opportunity to prosper.”
“This puts to bed, once and for all, the myth
that the Island of Guernsey is a tax haven. It is not. It is a low-tax
jurisdiction which embraces the best of international standards. The stigma
of tax haven status should be gone forever.”

My dad's car is bigger than yours.

The point I think that is trying to be made is that the industry that makes us fat, that pushes prices unrealistically high, creating a two or three tier opportunity of choice for the locals in these jurisdictions, is based - by the only research available by independents - on reducing other countries' central revenue.

So not only do the local non-sector workers get less proportional benefit from the trickle down (more of a tiny drip), but the non connected locals in the countries we are degrading get kicked in the teeth too.

Someone needs to prove otherwise and not defend a blind dogma.

Interestingly those that promoted the ideology of neoliberalism have seen their predictions come horrible wrong. The countries that were exalted as the model economies were, amongst others

Iceland
Ireland
Estonia
Latvia

Check out how well they're doing.

And we're in thrall to this thinking.

Thanks for that Arnald.

Sorry, I'm getting confused, thanks for that Fast Robert.

You ain't seen me, right?

Tax the rich!