
The Final Days of a Tax Haven - chollida1
https://www.bloomberg.com/news/features/2017-11-15/the-final-days-of-a-tax-haven
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cletus
So the elephant in the room here is that the US is increasingly a tax haven.
Not for US citizens. For everyone else.

The reason? The US might throw it's weight around with FATCA and many things
before it to get even moderately sized transactions reported to it and to have
assets of US citizens reported but the problem is the information doesn't go
the other way.

So the result is those dodging taxes in the EU will probably treat the US as a
financial shield to hide wealth from their governments.

~~~
e40
I'd really like to see non-US residents putting money into real estate pay a
huge tax, to discourage purchase of condos and single family homes. There's no
reason, to purchase these items and leave them empty, as a hedge against
whatever is going on in their country. I'm not exactly sure where to draw the
line, but if you send a kid to the US for school, and they live in your
condo/house, that's fine. But, do we want speculators from outside the country
purchasing and leasing back to US residents? Seems like a bad recipe.

~~~
jaredklewis
Not sure why "speculators from outside the country" are worse than those from
inside the country. Personally, I would prefer we encourage efficient land use
by everyone, regardless of their nationality.

One elegant taxation system to accomplish that is the land value tax:
[https://en.wikipedia.org/wiki/Land_value_tax](https://en.wikipedia.org/wiki/Land_value_tax)

~~~
solotronics
isn't the most efficient land use just letting the free market work without
taxation? if land is best used as a store of value for someones money then
thats what it is.

~~~
khuey
Land is required for things necessary to human existence and it's not really
possible to make more of it so if the market determines that the "best" use of
it is for storing money society should probably step in and overrule the
market.

~~~
Nrsolis
Uh huh.

That's all well and good until someone decides to apply that reasoning to
something else, like, say....the Internet.

You really think all that wireless spectrum is finding it's best use sharing
cat videos? High-bandwidth video emojis?

They aren't making any more RF spectrum either.

One man's "common sense solution" is another man's "free market distortion".

And there is PLENTY of land to go around....so.....bad example. You could give
nearly every single person on the planet plenty of room to live in Texas.
That's without going vertical into multi-story buildings.

Ultimately the best use of people's labor is whatever they want to do with it.
If that's buying houses, great. Beanie babies, faberge eggs, gold ingots,
whatever.

Do you really need all that crap you own?

~~~
heavenlyblue
RF spectrum is highly regulated, by the way.

~~~
Nrsolis
Less than you might think.

It's treated like real-estate with RF "zoning rules".

But very wide swaths of the RF spectrum are essentially a free -for-all. You
could argue that the most valuable parts (UHF) are used for stuff that could
only be described as "non-essential" e.g. cat videos.

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f_allwein
If I understood correctly, this says Vanuatu is unhappy that it got gray-
listed for dubious tax practices, whereas other tax havens weren't. This will
affect the price of "imported food, such as rice, and fuel."

> The offshore financial sector kicks in only about 4 percent of the country’s
> annual output of roughly $800 million, but its existence requires an
> ultralow tax environment that deprives the government of some revenue.

Not sure I get this. I don't see a rational reason why such tax havens should
exist in the first place. If efforts are made now to regulate them, surely
that's a good thing. Hope they will be able to transform their economy anyway.

~~~
ABCLAW
These are small countries with a number of sophisticated ex-pats who have
placed themselves in positions of power to control local regulations. The
result of this control is an influx of offshore funds which they manage as
financiers, local board members, solicitors or other enabling corporate
professionals.

These individuals make very respectable incomes doing very little work living
in an area with a rock-bottom cost of living and propagate their status in
society by imposing regulations that lock in the need for their services, like
local directorship quotas for local companies. An individual can sit on 30~ or
so local boards for $20,000 a year each with a PO box for an office. That's a
cool half-mil per year to sit on the beach, drink out of a coconut, and read a
few pages of board materials a day.

This isn't the case for all companies, but it sure is the case for some.

~~~
knocte
Even if what you describe sounds terrible and immoral, thing is, it's not
illegal, and it's a consequence of how our capitalistic/bureaucratic system
works. Let's fix the root cause instead.

~~~
f_allwein
indeed - it has been pointed out elsewhere that slavery/ beating your wife/
... used to be illegal. It is up to us/ our democratic system to fix this.

~~~
knocte
You can enforce international laws about human rights, but not about economy.

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ABCLAW
Sure you can. We just don't. If you think the EU and the US couldn't get an
international tax harmonization treaty that allowed countries to follow
revenue into specified haven countries and tax the cash flows where the
revenues were generated, you're nuts.

Viewed as distinct, large nations have a fuckton more negotiating leverage
than Vanuatu's financial industry.

The real issue is that Vanuatu and other similarly placed tax havens aren't
distinct. They are run by sophisticated professionals for capital holders in
developed countries.

Those are the same people who are at the bargaining table; those who know
about the issue in depth or that have substantial capital involved all benefit
from the wealth extraction the current international regime provides.

~~~
knocte
Interesting.

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Merthurian
The tightening of the screws against tax heavens gives me warm fuzzies. The
rich will retreat to Bitcoin soon.

