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Headlines
The
rush to regulate
Recent
Concerns in the Offshore Industry
Money
Laundering - The role of the FATF
OECD
Moves Forward in Counteracting Harmful Tax Practices
Has
The Dot Com Fever Hit The Offshore World?
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Recent Concerns in the Offshore Industry
 The offshore industry is changing, and is subject to scrutiny by the international community. The OECD and EU declared policies demand action against jurisdictions which operate percieved Harmful Tax Regiemes.
There is no doubt that the offshore industry is changing, and is subject to scrutiny by the international community for two reasons:
Firstly, because of the assumption that money launderers are facilitated, and,Secondly (and most likely the more motivating factor) for causing flight of capital to less taxing shores.In most OECD countries competition lies at the core of the economic culture, but curiously not always in the case of taxes. In the case of taxation our industry has been aquatinted with the aphorism "harmful tax competition". In the essence, taxes are levied for the provision of public services with a final goal of furthering the common good of a geographically definable population. Less tax revenues in the "perfect" state means the provision of less public services, which gives sufficient justification to hinder and restrict the movement of capital. There are a couple of flaws inherent to these assumptions:
Firstly, governments are not always the wisest spenders, and having competition between governments for corporates and individual tax payers and their money will keep them, like any other "provider of services" on their toes and encourage them to get it right.Secondly, in business of the 21st. century, geography plays a minor role, especially in light of the internet and the tax nightmare it causes. This should provide governments with enough incentives to come up with a drastically new idea to bring taxation into the 21st. century and not try to go back to times of exchange control in the disguise of capital exit or other taxes. Surely this cannot be the answer to the future ahead.
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