The Top 10 Tax Havens: Tax Justice Network

Governments from 20 of the wealthiest nations in the world vowed in 2009 to tighten regulations that allowed for rampant tax evasion in nations and territories where financial secrets of clients were witheld from authorities. But two years later, people looking to evade their taxes using offshore accounts still have plenty of countries to choose from, according to a new report from the Tax Justice Network.

The report, called the Financial Secrecy Index, assesses 73 jurisdictions that, allow for billions of foreign dollars to be kept in offshore accounts and untaxed. About $250 billion in tax revenue is lost by governments worldwide due to offshore accounts each year, according the Tax Justice Network.

Called the "grandfather of the world’s tax havens," Switzerland tops the list of the world's best tax havens both for its level of secrecy and the scale with which bank accounts are managed in the country. Though other jurisdictions like Bermuda and the Bahamas have laws that allow for more secrecy than Switzerland's, they rank lower on the list because they operate on a smaller scale. Larger nations like Germany and Japan, while less secretive appear in the top 10 due to their size.

Switzerland recently made deals with the Organization of Economic Cooperation and Development that aimed to tighten regulations on tax evasion, but the Tax Justice Network report found these agreements have been "operationally ineffective" due to Switzerland's "widespread involvement in the administration and use of trusts, foundations and offshore companies."

The U.S. is the fifth best tax haven according to the report and government officials may be making some headway in breaking down Switzerland's secrecy laws. In September, the U.S. government obtained the account information of American clients at 10 major Swiss banks.

Swiss bank officials were not amused by the investigation. Once the probe was announced, one chairman in particular said he regretted taking on American clients.

Here are the top 10 tax havens, according to the Tax Justice Network:

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Comments

[frank1946]

08:03 AM on 10/13/2011

Where did all the Rich go ?

Answer: They are not Stupid, they are logical and they take the $$$ and go somewhere
to avoid Insults and Taxes !

I would do the same.

[smok]

07:23 PM on 10/18/2011

THIS IS WHAT TRUE PATRIOTIC AMERICANS DO ....LET THOSE BARBARIANS ANTI-AMERICAN POOR LEACHES PAY TAXES HERE......LOSERS HA HA HA

[ezer]

02:29 PM on 10/06/2011

Here is the proof the US is a tax haven for rich foreigners that want to invest tax free and anonymously in the US:
http://www.forbes.com/sites/beltway/2011/04/24/lawmakers-fight-irs-proposal-for-banks-to-report-interest-earned-by-foreigners/
It is a bit hypocritical to give lessons to the rest of the world.

[sallybmccarty]

05:46 AM on 10/06/2011

Why is the writer suprised that the USA is #5? I was surprised it wasn't #1,

[ezer]

11:27 AM on 10/06/2011

It was. It slipped to 5 because of the Dodd-Frank act.

[bear2right]

05:29 AM on 10/06/2011

Let's take a look at some famous "tax cheats" -- Al Capone, Richard Hatch (first "Survivor" winner), Leona Helmsley, Willie Nelson, Wesley Snipes, Nicolas Cage, Richard Pryor, Sophia Loren, Pete Rose, O.J. Simpson, Abbott & Costello, Sammy Davis, Jr., MC Hammer, Heidi Fleiss, Randy Quaid, Darryl Strawberry­, John Gotti, Spiro Agnew, Redd Foxx, Judy Garland, Stephen Baldwin, Timothy Geithner, Tom Daschle.

Recognize anyone? Contrary to what other posters have written, there's no pattern here. No particular political party, no particular gender, no particular race -- tax evasion is open to all.

I can't blame top earners for wanting to keep their money. Our tax system is broken and unfair. Our government -- on all levels, federal, state, local -- spends way too much on things that are unnecessary. Tax rates on ordinary income are way too high. Are you familiar with the Alternativ­e Minimum Tax? This is a separate tax schedule that was created in 1969 because someone in a position of power got their panties in a twist over 155 upper income households that didn't pay any tax -- yes, only 155 households --out of how many in the U.S.? Anyway, it gets worse -- somehow, this tax has not been adjusted for inflation, so the middle class increasing­ly gets spanked with it. Look it up if you want more info.

I don't advocate breaking the law, but I do advocate changing the laws.

[rg686217]

04:53 AM on 10/06/2011

This article fails to mention that most countries do not tax foreign income of their citizens so it doesn't make any difference where they keep their money. Only the US chases their citizens around the globe. However, let um look cause they will never find it. Ha Ha

[ezer]

11:59 AM on 10/06/2011

Yes, the US is the only industrialized country that taxes its citizens wherever they are in the world.
It is quite unfair as US expats already pay taxes where they live but in addition have to pay taxes to the US (minus a credit but often it does not cover all).
Often US citizens abroad are there to sell and promote American goods and services yet they are the ultimate cash cow as they do not have representation in Washington.

[wsdave]

02:49 PM on 10/08/2011

Excatly!

[Colin Daniel]

12:03 PM on 10/06/2011

Very good point. Most countries tax income by source on by residency, The US taxes based on citizenship.

[Joe Mando]

04:42 AM on 10/06/2011

If Connecticut were a country -- it would be Number 1 on this list. The state is still wide open for any company that wants to build and operate TAX FREE! If that were not enough -- the State of Connecticut will even help pay for your company or industry to build what you need.

[Still kickin]

06:10 AM on 10/06/2011

But tax its residence into oblivion.

[Joe Mando]

04:40 AM on 10/06/2011

Even now the so-called 'neutral' Swiss government is supposed to be closing all tax loopholes for foreigners. In other words, they agreed to cease and desist from allowing foreign citizens and companies from hiding money and depositing money for tax evading purposes.

That was the big announcement months ago -- so where's the follow-up by the media and/or various world leaders?

[ezer]

11:35 AM on 10/06/2011

The Swiss will accept individual requests. Meaning, if the DOJ asks the Swiss to know if a particular individual has an account they will collaborate.
On the other hand, the Swiss law does prevent fishing expeditions such as let's say Venezuela wanting to know all the Venezuelans that have an account in a Swiss bank.
The Swiss will tax anonymously citizens from a certain country and transfer the proceeds every year to the country that requests it.
It is happening now with Germany, UK, India, and Russia.

[pitciarn]

03:43 AM on 10/06/2011

The Swiss should be considerd CRIMINALS !! They have this BS pastoral image of Heidi, cows and watches !!

Prior to and during WW2 the sweet Neutral Swiss acted as money launder's for the Nazi's. Turning Stolen Gold and artworks into cash to buy war materials the Germany lacked, so much for being Neutral.

Jewish citizens of Europe placed their fund's and property in SWISS banks for safekeeping before 1Sept 1939 (Day Hitler Invaded Poland, starting WW2). After 1945 when the surviviors of the Camps or their children went to claim their property, the SWISS demanded Proof of ID or Proof of DEATH. All their Survivors records were destroyed in the war and the Nazi's did not issue a Death Certfiticate when they BURNED THE BODIES !!!

Screw the SWISS until they give EVERYTHING back they stole from the Jewish people or got from the Nazi's. The Germans admitted their crimal actions were wrong for WW2, but the Swiss get a free pass ??

[rjsparling]

05:23 AM on 10/06/2011

So how do you think banks should distribute this money?

[ezer]

11:18 AM on 10/06/2011

Oh please. There was the Volcker investigation then the Bergier commission report. Every account has been reviewed. The Banks and the Swiss government spent $500 million going over all the dormant accounts. Even the gold from the BNS was analyzed for chemical content to make sure it wasn't from teeth filling.
Your accusations are misplaced.
On the other hand there has never been any investigation in the US and there are still tons of looted art in US museums.

[HopeWFaith]

03:07 AM on 10/06/2011

Where are the Republicans when tax evaders are running rampant? They are scurrying around finding new ways to detract the nation from the real business of correcting the crush upon the poor and the middle class. They are now running rampant with new tactics to distract the nation. Try focusing in on Justice Department instead of on the real issues of the crisis in America. Try any tactic you can, other than dealing out good jobs legislation, good reforms legislation. The GOP's handy work is to crush the middle class and the poor, to stay in POWER - their only motive for doing anything.

[msbeal]

02:30 AM on 10/06/2011

A black guy in an alley caught with crack goes to jail but 2,000 rich Americans evading taxes in Switzerland have their identities protected by our government.

Why is that?

[Caseybug]

03:00 AM on 10/06/2011

Your answer is in your statement.

[westral]

01:54 AM on 10/06/2011

Evasion of taxes is not laudable, it is unpatriotic. Expecting the rest of the country to contribute to society while you funnel your wealth into a tax haven is reprehensible. They might say "it's my money" but it's earned from Americans and with the support of American society.

[ezer]

12:06 PM on 10/06/2011

Completely agreed but the US also has billions in foreign money that we do not tax and that was siphoned from foreign economies. Why do we do that to other countries? It is a bit hard to complain about Americans stashing their cash abroad when we encourage foreigners to do the same here.

[No more Kool Aid]

12:47 AM on 10/06/2011

By the sheer numbers of public officials caught and let go for tax evasion, I would say the Capitol of any state or D.C. are very good tax Havens.

[dearthaircroi]

12:41 AM on 10/06/2011

If the governments didn't waste so much that they are always finding new ways to rob everyone people wouldn't be looking to hide their money.

[ariando]

10:54 AM on 10/07/2011

I agree that the government spends money in areas that I don't agree with.
But isn't it simplistic to say that this is the reason people hide their wealth?
There will always be people who dan't want to pitch in when they should.

[maxfax]

12:05 AM on 10/06/2011

"...But two years later, people looking to evade their taxes using offshore accounts still have plenty of countries to choose from" Beyond absurd.

[ezer]

12:19 AM on 10/06/2011

It was a charade. The G20 promised to crackdown on tax havens (but they did not include themselves in the list of tax havens). The UK banking benefits tremendously from the channel islands. Total hypocrisy. Same for the US.
To be fair the collapse of the Euro zone distracted those governments. Switzerland is discreetly negotiating bilateral agreements with many countries where the Swiss will tax foreign nationals directly and pay the foreign governments without breaking privacy laws.
They have agreements in place now with the UK, Russia, Germany, and India.

[Kai-HK]

12:01 AM on 10/06/2011

Excellent! Good to know that the rich have options, as they should, and that any class warfare actions will backfire for the poor in the long term.

Kai