USA: The New Switzerland?

Monday, February 29, 2016
By Paul Martin

By: Jeff Thomas
Monday, 29 February 2016

At one time, tax havens took great pride in calling themselves just that, since low-tax jurisdictions provide people with freedom from oppressive taxation.

But, in recent decades, the Organisation for Economic Cooperation and Development (OECD, based in France, but largely funded and controlled by the US) has been on a rampage to crush tax havens. The attacks have been regular and forceful and, although tax havens still exist around the world, every one of them has caved to a greater or lesser degree to ever more stringent OECD “international practices.” Presently, all tax havens live in fear of the OECD and its powerful enforcer, the US.

No measure has been more devastating to freedom from taxation than the US Foreign Account Tax Compliance Act (FATCA). The secret of its success is that the US fines banking institutions for not following the arbitrary FATCA guidelines. How can one country fine a bank in another country if that bank is following the laws of the country in which it’s located? Well, failure to pay the fine may result in the US cutting the bank out of international transfers in the SWIFT system, which would collapse the bank.

Essentially, this is a “shakedown” operation, purported to focus on tax evasion, but, in fact, focused primarily on demanding protection money from international banks. (More than eighty Swiss banks have been subject to roughly five billion dollars in penalties and fines imposed by the US.)

Not surprisingly, the OECD has spent decades castigating the very existence of tax havens, declaring them to exist solely for the purposes of money laundering, terrorism funding, tax evasion and even “international prostitution” (no kidding).

In spite of the OECD’s condemnation of tax havens, the US has, in recent years, created tax havens in several states, and is being dubbed “the new Switzerland.” Of particular interest here, is that the US itself has not signed on to the OECD’s “international standards.” The US is therefore imposing more stringent restrictions on others than it is willing to comply with itself. (Had Attila the Hun gotten into banking, this is the approach he might have used.)

Recently, the US has lifted the veil on their ambitions by announcing further, more dramatic inroads into becoming a tax haven. In September of 2015, Andrew Penney, a managing Director of Rothschild & Co. in San Francisco, announced that the world’s wealthy can avoid paying tax by moving their wealth to the US. As the US banks will not be subject to the draconian limitations that the US/OECD have forced on the world’s other tax havens, the US will (presumably) take over the tax haven business.

In one fell swoop, the sanctimonious position taken by the US, portraying tax avoidance as unpatriotic and even criminal, has been turned on its head.

The Rest…HERE

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