30 SECOND GUIDE: Tax Havens
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The Daily Mail City team explains why some countries are tax havens and what that means for other countries.
What are they?
Pretty much what it says on the tin. Some countries or states create a favourable environment to take advantage of the market for tax avoidance. They tend to be small countries with little else to differentiate themselves which use sympathetic tax levies to woo firms and individuals.
Where are they?
They are found in some of the world’s most glamorous locations. Nearby are Guernsey and the Isle of Man, but Monaco, the British Virgin Islands and Bermuda promise an even more dazzling, sun-kissed home for the rich to stash their cash.
Metro graphic showing tax havens around the world.
Is it legal?
Hordes of wealthy accountants are paid fat fees to tread the line between ensuring clients avoid tax – which is legal – and making sure they don’t evade it, which isn’t. One mistake could lead to a big bill or even spending time at Her Majesty’s pleasure.
Why do we care?
A new wave of tax havens
have agreed to share information with the taxman to stamp out evasion
rather than defeating their whole raison d’etre. Montserrat and the
Turks and Caicos Islands have volunteered to pass on details of
customers.
Why now?
The UK is about to head the G8 – and along with other cash-strapped governments – wants to maximise its tax revenues.
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