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The talk of the
day is about Offshore Havens?
To take the mystery out of offshore havens, first we must define it. Only
then can you clearly understand it.
An offshore haven is simply a country other than your own. To Americans, an
offshore haven is anywhere you bank or invest outside the United States.
If you are Canadian, any foreign land beyond Canada is an offshore haven.
Offshore havens come in every size, variety and political persuasion, and
they can be found everywhere. There are islands that surround the United
States, Bermuda, British Virgin Islands, and the Bahamas. These are all
different tax havens. The Oriental countries like the Philippines, Hong
Kong, and Singapore have been tax havens for many years before the above
countries. What makes everything work so well is what we can do today
better than what was done a few years back.
This is the age of digital electronics and electronic banking. Electronic
banking can be done as easily from one continent to another, as easily as
one neighbor walking to another neighbor’s house.
The United States is an excellent Offshore Haven; it offers foreigners
considerable tax breaks to invest here. Of course, these tax breaks are
not available to the citizens of the United States. This also explains why
middle-Eastern and Japanese investment capital flows into the United
States. The favorable exchange rate and foreign view that America is a
bargain-hunter’s paradise adds to the shine of wealth. Offshore havens do
not attract foreign money by chance they do it by design. They
intentionally restructure their laws to become more financially attractive
and they do it quite creatively.
As some havens are becoming popular, others are losing their long standing
position. Switzerland was once considered the ruler of the offshore
havens, with its secret numbered accounts. Their ability to insure privacy
has eroded largely due to international (mostly from the United State)
pressure. The same is true of the Bahamas and the Caymans, who have
recently attracted a great deal of political attention. In turn, some of
the smaller upstarts, Cook Islands, Gibraltar, Nevis and the Turks can
guarantee more protection because they are less subject to international
pressures.
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