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The World’s Favorite New Tax Haven Is the United States
- yardie 11y agoWe've been sailing for a little over a year now. We've encountered many US flagged boats where there isn't a single US citizen owner, captain, or crew aboard. This has been the case where the owner is Turkish, Israeli, Emirati, and lots of middle-east countries. The super yachts still prefer to use the Marshall Islands, Caymans, or Gibraltar as their flag of registration. Our boat is US LLC registered since my wife, a foreign national, can't be a direct owner for a US registered vessel. Nor can I be registered owner in her country as a non-citizen. So a US LLC is a convenient neutral mechanism. It's split 51/49% with me having the controlling shares as required by law.
- zekevermillion 11y agoWhy would you want a US-flagged boat other than patriotism? (Not being facetious, actually curious if there's a reason to prefer Amurrican to one of the more typical flag countries.)
- bzbarsky 11y agoFor a commercial vessel, if you want to carry cargo from one US port to another. See https://en.wikipedia.org/wiki/Merchant_Marine_Act_of_1920 https://en.wikipedia.org/wiki/Merchant_Marine_Act_of_1920 though that also requires the vessel to be US-built/owned/crewed...
- superuser2 11y agoTheoretically, the protection of the US Navy.
- rpgmaker 11y agoWatching Captain Phillips one of the things that impressed me the most was how much money and effort was put into rescuing Captain Phillips and his crew. Of course much of the pressure was political with Obama just starting out his presidency but still, it was a clear indication that it pays to be American.
- yardie 11y agoWhats a typical flag country? You mean Panama, Liberia, Cayman islands? To get those flags costs thousands of dollars per year in incorporation fees. For your typical billion dollar cruise liner, or megayacht, this is a rounding error. My DE corporate taxes are $300/year. Its a bargain in comparison.
- raverbashing 11y agoMeet the new boss, same as the old boss And people think "whistleblowers", and "think tanks" denouncing "lack of transparency" in certain locations have only ethics at heart.
- coldtea 11y agoTons of NGOs and activists play foreign policy games -- it's the first line of attack, before bringing in "democracy" with canons.
- unexpand 11y agoLove the illustration in this article by Steph Davidson adds much meaning to the context.
- _Codemonkeyism 11y agoI found "Treasure Islands: Tax Havens and the Men who Stole the World" a very interesting book on tax havens, and it made the point about the US. I also found this idea from the book enlighting: All the tax havens around the US, they don't have 'real' banks, they put the money into NYC banks. Same with the UK: Tax havens in the cloud/former empire of the UK put the money into banks in London. The real beneficiary are not those islands, but US and UK banks.
- xmr 11y agoPlainly not true; certainly for banks in the UK overseas and crown dependencies.
- hackerboos 11y agoThe largest bank in the Seychelles (a known tax evasion jurisdiction) is Barclay's, based in London.
- zekevermillion 11y agoThis may actually be true due to correspondent banking -- e.g., the Bank of Drug Dealers and Terrorists based on an oil rig in the Pacific may in fact be a correspondent with CitiBank (just a fictional scenario of course, I'm sure Citi would never agree to any relationship with such a sketchily named bank)
- _Codemonkeyism 11y agoPlainly true, those 'banks' or trusts don't have their own data centers and infrastructure where the money just 'rests' as records in databases they put it into their accounts in other banks, London banks in this case to make more money.
- Shivetya 11y agoI never understood why when people cheered on the pursuit of US money in foreign banks why they never understood the big picture. The US government regardless of party is only looking after one thing, itself. While you may have talking heads sent out to decry abuse of the system they are their to misdirect. Politics wants money and not for the public coffers. While they will bleat all day how this money in foreign institutions is depriving the people and theft what they really want is control over the people who have the money so they give it to those they want it given too, themselves. It is the same when corporations sell themselves over seas, the influence factor is lost and in turn the ability to extort campaign funds
- apaprocki 11y agoIt has been suspected that for a long time now people have been parking questionable cash into NYC real estate. Somewhat related to this, the Treasury dept. will pierce the veil of LLCs making >= $3 million cash real estate purchases and require the owner identities to be reported. I guess we'll see if that leads to new tricks... http://www.nytimes.com/2016/01/14/us/us-will-track-secret-buyers-of-luxury-real-estate.html http://www.nytimes.com/2016/01/14/us/us-will-track-secret-bu...
- hkmurakami 11y agoHN discussion thread for link: https://news.ycombinator.com/item?id=10918491 https://news.ycombinator.com/item?id=10918491
- Spooky23 11y agoIt's worse than that -- political contributions from LLCs are unregulated in New York, so who knows who is influencing who. Once shady money gets established in the US, you can do things like setup LLCs and trusts domiciled in South Dakota to provide multi-generational tax exemption. http://www.sdtrustco.com/About-South-Dakota-Trust-Company/Why-South-Dakota-/Asset-Protection.aspx http://www.sdtrustco.com/About-South-Dakota-Trust-Company/Wh... This type of nonsense is a great example of the incredible harm done to the United States 40-50 years ago when the pro-segregation Democrats joined forces with the Western republicans (i.e. The ultra-conservative folks dependent on federal leases to extract minerals/oil/graze cattle) and took over the GOP.
- randycupertino 11y agoYes and thankfully the US congress just made it even easier for foreign $$ to invest in US real estate! http://www.wsj.com/articles/congress-eases-curbs-on-foreign-real-estate-investors-1450657972 http://www.wsj.com/articles/congress-eases-curbs-on-foreign-...
- marvel_boy 11y agoA lot of startups founded in Spain have the legal headquarter in Delaware (USA). Anyone knows the reason for this?
- herge 11y agoOne reason may be to make it easier to raise money. Most VCs know the ins and outs of corporate law (and corporate law precedents!) in Delaware, making signing a contract there a lot easier, as opposed to learning the specificities of Spanish law.
- marvel_boy 11y agoI see. Thanks
- yardie 11y agoBecause Spanish bankruptcy laws are anachronistic in that it kind of does not exist. If your business fails in Spain you are on the hook for entire amount. People have committed suicide over it. There was a movement to get it changed after the GFC 2008 but I'm not sure if they've been brought up to date or not. Less risky to create a Delaware LLC, open a spanish subdivision, and if it fails no one has to sell their house.
- novaleaf 11y agoRelated: but Seattle's $750K+ housing market is dominated by Chinese cash buyers.
- hackerboos 11y agoI see the same thing claimed in Vancouver but there is no conclusive evidence.
- edwinnathaniel 11y agoTry show up as interested buyer and see what the real estate agents tell you :D
- sumedh 11y agoI dont know about Vancouver but in Melbourne lot of for sale commercial properties also have the sign in Mandarin(or Cantonese).
- deelowe 11y agoIt's happening all over. I do a good bit of real estate investing and research on the side and foreign institutional investors have been buying up every property they can come across for years.
- ethbro 11y agoTo be fair, if I were a wealthy Chinese national, I'd sure as hell be parking cash in diversified assets abroad.
- jernfrost 11y agoThat is rich. So they US wasn't fighting the good fight here, but rather looking after itself, arm twisting the existing tax heavens so that it could become the new tax heaven! Ah well I guess hypocrisy is something the US has mastered to perfection decades ago. Well I hope the EU is not going to stand for this. I am tired of American bullying. Some mutual respect would be nice for a change.
- happyscrappy 11y agoRespect is earned not by weakness. Europe should be a powerhouse but are too limp wristed.
- ethbro 11y agoTired of America bullying? One of the reasons we probably didn't sign on to the treaty is because anything that sounds like UN or international agreement is toxic for roughly half of our voters. And the primary reason for that (not completely unjustly) is the feeling that no one else will do the work if we don't. Stuff like [1] and [2] make it kind of hard to argue. [1] https://en.wikipedia.org/wiki/United_Nations#Funding https://en.wikipedia.org/wiki/United_Nations#Funding [2] http://sites.uci.edu/energyobserver/2014/03/17/comparison-of-russian-military-budget-with-eu-nato-and-us-budgets/ http://sites.uci.edu/energyobserver/2014/03/17/comparison-of...