[...]... secrecy jurisdictions, is the biggest This is a layered hub-andspoke array of tax havens, centered on the City of London, which mostly emerged from the ashes of the British empire.18 As I will show, it is no coincidence that the City of London, once the capital of the greatest empire the world has known, is the center of the most important part of the global offshore system The City’s offshore network has... alliances with each other against the ordinary citizens of these poor countries and against their own citizens too The United States anchors the third big offshore pole Before the great global offshore explosion began in the 1960s and the 1970s, the U.S government was generally hostile to offshore business, and its leaders fought against the British spiderweb and the European havens But as the 1970s wore... here: Tax revenues and other money are being drained out of the United States into tax havens elsewhere, and a flow of foreign (often dirty) money is moving in the other direction back into the country The United States is estimated to be losing $100 billion annually from offshore tax abuses—a gigantic transfer of wealth from ordinary taxpayers to rich people.30 And that is not to mention the role the offshore. .. threatened that if they didn’t get their way, the ork small ones would find some foreign ally of more honor and good faith, who will take them by the hand and do them justice.” It is easy to see, in light of examples like this, why offshore business is so often described as unpatriotic Offshore corporate tax avoidance really started taking off around the time of the First World War: Before that, taxes were... freezers, the docks, the ships, the insurers, the wholesalers, and the retailers, then you can, by adjusting the prices one subsidiary charges another for goods, drive the profits away from the producer and the consumer countries, and instead take your profits at the most convenient place down the line And the most convenient stage,” notes Knightley, “is naturally where you will pay the least taxation,... corporations His research underlines the point that illicit offshore flows of money are far less about the drug smugglers, mafiosi, celebrity tax exiles, and fraudsters of the popular imagination and mostly about corporate activity And out of this emerges another profoundly important point The drug smugglers, terrorists, and other criminals use exactly the same offshore mechanisms and subterfuges—shell banks,... all The global offshore system was one of the central factors that helped generate the latest financial and economic crisis since 2007 Offshore did not exactly cause the financial crisis: It created the enabling environment for the conditions underlying the crisis to develop “Trying to understand the role that offshore secrecy and regulatory havens have in the crisis,” Jack Blum explains, “is like the. .. States and other large economies with the offshore club—“don’t tax or regulate us too heavily or we’ll leave,” they cry and the onshore politicians quail and relax their own laws and regulations As this has happened, onshore has increasingly taken on the characteristics of offshore In the large economies, tax burdens are being shifted away from mobile capital and corporations onto the shoulders of ordinary... secrecy jurisdiction emerged in the United States in the late 1990s, and in this book I will use it interchangeably with tax haven I will call the whole global structure of these places, and the private infrastructure that services them, the offshore system Another common marker for tax havens is very low or zero taxes, of course People and corporations use them to escape tax, legally or illegally Secrecy... and to fail As Britain’s tax authorities noted, taxes on business profits never stop you from earning the profits—they only kick in once there are profits But William and Edmund Vestey were having none of it In November 1915, as fifty thousand British soldiers died at the Battle of Loos, the brothers moved overseas to cut their tax bill Their first stop after leaving was Chicago, where they found they . Cataloging-in-Publication Shaxson, Nicholas. Treasure islands : uncovering the damage of offshore banking and tax havens / Nicholas Shaxson. p. cm. Includes index. ISBN 97 8-0 -2 3 0-1 050 1-0 1. Tax evasion—United. coincidence that the City of London, once the capital of the greatest empire the world has known, is the center of the most important part of the global offshore system. The City’s offshore network. City, and the Cayman Islands; Washington, the Bahamas, and Riyadh. Offshore connects the criminal underworld with financial elites and binds them together with multinational corporations and the