EXPERT VIEW: Attacks On Wealth And The Offshore Jurisdictions

Henry Fea, Charles Russell, Private Client Partner, 17 September 2012


Reactive moves

Using pressure on the offshore jurisdictions to increase the tax take has been remarkably effective at changing the business and branding of these jurisdictions, although it is perhaps more questionable whether it has resulted in increased tax in the developed jurisdictions who insisted on the changes.  In June 2012, the UK tax authorities suggested that an attractive tax disclosure programme started in 2009 for UK tax payers who have under-declared funds with a Liechtenstein connection, would result in £3 billion being raised in tax by 2016. The reality is that it is more difficult now to use this facility than it was prior to August 2012 and up to June 2012 only £363 million had been raised, making £3 billion look ambitious. 

Agreements currently being negotiated between the UK and Switzerland and Germany and Switzerland, which would result in either information exchange or a withholding tax, may simply result in movements of funds away from Switzerland, with rumours that Singapore has already been a beneficiary.  For those prepared to actively manage their funds, differentiation will always be possible.

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