Switzerland and the United States in the lead: the real ranking of tax havens

Switzerland and the United States in the lead: the real ranking of tax havens

The Tax Justice Network association is concerned about Washington's increasingly aggressive attitude to recover foreign money.

A blacklist of tax havens, with objective criteria and no last-minute secret dealings? Far from the controversial one set by the European Union (EU), where there are only nine countries left, Tax Justice Network (TJN) carries out its own every two years, scrutinizing one hundred and twelve jurisdictions. Published Tuesday, January 30, it again ranks first in Switzerland, followed by the United States and the Cayman Islands.

"Unlike others, the list is not based on political decisions," says TJN. Europe is therefore not exempt: Luxembourg is in 6th place, just ahead of Germany, while Guernsey is in 10th place. Three Asian jurisdictions are also in the Top 10, with Hong Kong, Singapore and Taiwan.

One of the main lessons of this ranking is the rise of the United States. Ranked 6th in 2013 and 3rd in 2015, they are now in 2nd place. "And if this continues, it's quite possible that they'll be in the lead next time," said John Christensen, president of TJN. At issue: the political choice of the United States to fight firmly against tax havens abroad, while being very lax at home.

"Financial opacity"

The TJN study goes beyond tax havens to focus on the broader concept of "financial opacity" of countries. The calculation combines two indices: the transparency of a jurisdiction (automatic exchange of data or not, existence of a register of the beneficiaries of companies or not, etc.) and the size of its financial sector. By mixing the two, TJN measures the global impact of the country on questionable finance (financial crime, tax evasion, money laundering ...).

Taking only the first measure, the most closed tax havens are Vanuatu, Antigua and Barbuda and the Bahamas. But, by integrating their importance in global finance, Switzerland (4.5% of international financial flows) and the United States (22.3%) take the lead.

For Switzerland, TJN recognizes that real efforts have been made, but the association believes that they are partial and slow. On the positive side, the country has agreed to join the automatic data exchange agreement put in place by the Organization for Economic Co-operation and Development (OECD). This measure, keystone of the fight against tax evasion, has been applied by the Swiss Confederation since the beginning of the year. In concrete terms, this means that if a French person has an account in Switzerland (declared or not), the French authorities will have to be informed automatically, without having to ask for it.

Dalaware, Wyoming, Nevada: "The Wild West" Fiscal

As a result, US financial institutions are taking the opportunity to chase customers, particularly in emerging countries. "They have put in place a very aggressive marketing internationally, insisting that FATCA is not reciprocal," says Christensen.

Obviously, it works: the market share of the United States in international financial flows has increased from 19.6% in 2016 to 22.3% today. Added to this is the attitude of the states of Delaware, Wyoming and Nevada, which make it possible to register nominees and trusts completely anonymous extremely easily. "There, it's the Wild West," says Christensen.

Lastly, the ranking is not very tender towards Germany, which is dragging its feet in Brussels to avoid setting up a registry of beneficiaries of financial vehicles, and who is reluctant to sign agreements for automatic data exchange with emerging countries. . As for the United Kingdom, its good score (23rd place, just ahead of France in 25th place), is explained because it is taken in isolation, far from its dependencies and its overseas territories semi -autonomes: "duplicity is flagrant," concludes Christensen.